MACROECONOMICS
Lagarde cautions vigilance
IMF managing director Christine Lagarde yesterday said the global economy was showing broad-based growth, but the landscape was shifting with heightened risks of trade disputes, monetary policy normalization and technological change. Lagarde, speaking to an IMF conference in Jakarta, said the IMF was expecting global growth to reach 3.9 percent this year and next, up from 3.7 percent last year. As ASEAN countries are preparing for higher interest rates in advanced economies, Lagarde said policymakers need to stay vigilant about its effect on financial stability and volatile capital flows.
INTEREST RATES
S Korea leaves rate at 1.5%
The Bank of Korea left its benchmark interest rate unchanged at 1.5 percent in Governor Lee Ju-yeol’s final policy meeting, as it weighs risks to its economic outlook against the cost of raising borrowing costs for the nation’s indebted households. South Korea’s solid economic growth is continuing, the bank said in a statement, adding that while inflation has slowed, it was expected to pick up toward the target of 2 percent in the second half of this year.
CHEMICALS
BASF reports surge in profit
German chemicals giant BASF AG yesterday reported a massive leap in profit last year, as the worldwide economic upturn fueled demand and stoked prices for its products. Net profit increased 50 percent year-on-year to 6.1 billion euros (US$7.52 billion), BASF said in a statement, in line with a forecast it offered last month. Operating profit increased almost 36 percent to 8.5 billion euros, while revenue was up 12 percent at 64.5 billion euros — beating forecasts from analysts surveyed by FactSet Research Systems Inc.
E-COMMERCE
EBay to buy Qoo10 assets
EBay Inc, operator of the namesake online marketplace, is close to a deal for the Japanese assets of e-commerce site Qoo10, a person familiar with the matter said. The San Jose, California-based company is buying the assets from its joint venture partner Giosis Pte, the person said. Under the proposed US$700 million deal, eBay would give up its stake in Giosis, the person said. Japan is the biggest market for Qoo10, and part of an e-commerce business that also operates in Singapore, Indonesia and Malaysia.
CRYPTOCURRENCIES
Circle purchases Poloniex
Circle Internet Financial Ltd, a closely held mobile payments firm backed by Goldman Sachs Group Inc, said it acquired Poloniex Inc, one of the largest digital token exchanges. Terms of the agreement were not disclosed. Fortune magazine earlier reported that the deal was for about US$400 million. Poloniex, ranked as the 14th largest cryptocurrency exchange by data tracker CoinMarketCap.com, said on its Web site that the US-based company was formed in January 2014 and is available in more than 100 countries.
TAXES
Super-rich flocking to Italy
Millionaires from Russia to Norway and the US are seeking to take advantage of Italy’s low tax rates for the super-rich. Italy last year unveiled a measure allowing ultra-wealthy individuals taking up residency to pay a flat tax of 100,000 euros per year. About 150 people, including some with wealth of more than “hundreds of millions,” have inquired about the measure, Fabrizio Pagani, head of the office of the Italian minister of economy and finance, said in London.
PROTECTIONISM: China hopes to help domestic chipmakers gain more market share while preparing local tech companies for the possibility of more US sanctions Beijing is stepping up pressure on Chinese companies to buy locally produced artificial intelligence (AI) chips instead of Nvidia Corp products, part of the nation’s effort to expand its semiconductor industry and counter US sanctions. Chinese regulators have been discouraging companies from purchasing Nvidia’s H20 chips, which are used to develop and run AI models, sources familiar with the matter said. The policy has taken the form of guidance rather than an outright ban, as Beijing wants to avoid handicapping its own AI start-ups and escalating tensions with the US, said the sources, who asked not to be identified because the
Taipei is today suspending its US$2.5 trillion stock market as Super Typhoon Krathon approaches Taiwan with strong winds and heavy rain. The nation is not conducting securities, currency or fixed-income trading, statements from its stock and currency exchanges said. Yesterday, schools and offices were closed in several cities and counties in southern and eastern Taiwan, including in the key industrial port city of Kaohsiung. Taiwan, which started canceling flights, ship sailings and some train services earlier this week, has wind and rain advisories in place for much of the island. It regularly experiences typhoons, and in July shut offices and schools as
FALLING BEHIND: Samsung shares have declined more than 20 percent this year, as the world’s largest chipmaker struggles in key markets and plays catch-up to rival SK Hynix Samsung Electronics Co is laying off workers in Southeast Asia, Australia and New Zealand as part of a plan to reduce its global headcount by thousands of jobs, sources familiar with the situation said. The layoffs could affect about 10 percent of its workforces in those markets, although the numbers for each subsidiary might vary, said one of the sources, who asked not to be named because the matter is private. Job cuts are planned for other overseas subsidiaries and could reach 10 percent in certain markets, the source said. The South Korean company has about 147,000 in staff overseas, more than half
CHEMICAL FIRE: 10 Indian employees were injured by smoke inhalation at a Tata Electronics plant in Tamil Nadu state that produces components for Apple Inc At least 10 people received medical treatment, with two hospitalized after a major fire on Saturday disrupted production at a key Tata Electronics Pvt Ltd plant in southern India that makes Apple Inc’s iPhone components. The fire occurred at the plant in the city of Hosur in Tamil Nadu state that makes some iPhone components. It broke out near another building inside the Tata complex, which was to begin producing complete iPhones in the coming months. The fire was contained to one building and has been extinguished fully, top district administrative official K.M. Sarayu said. No decision has been made on when
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