BANKING
Draghi hints at stimulus
European Central Bank (ECB) President Mario Draghi said at the institution’s annual forum in Sintra, Portugal, yesterday that if the outlook does not improve and inflation does not strengthen, “additional stimulus will be required.” He said the ECB can amend its forward guidance, that rate cuts remain “part of our tools” and asset purchases are also an option. Draghi added that risks from geopolitical factors, protectionism and vulnerabilities in emerging markets have not dissipated and are weighing in particular on manufacturing. The Governing Council will in the coming weeks review how their tools can be used to tackle risks to price stability, he said.
CHINA
New home prices up 0.71%
New home price growth in China quickened last month after government measures to spur demand in smaller cities took effect. The average value of new homes in 70 major cities in Asia’s biggest economy — excluding government-subsidized housing — rose 0.71 percent, according to data released by the statistics bureau yesterday. That was faster than an increase of 0.62 percent in April and a lift of 0.61 percent in March. Last month, 12 cities saw price gains of more than 1 percent, versus six in April.
FINANCIALS
China cuts Treasury holdings
China cut its US Treasury holdings to the lowest in almost two years as the months-long trade conflict dragged on between the world’s two largest economies. The nation’s holdings of notes, bills and bonds declined by US$7.5 billion in April to US$1.11 trillion, according to US Department of Treasury data released on Monday in Washington. The latest numbers were collected before tensions between Washington and Beijing escalated to a new level last month.
VEHICLES
Germany drives EU growth
European car registrations ended a nine-month losing streak to rise marginally last month, helped by a jump in deliveries in Germany. Deliveries rose 0.04 percent to 1.44 million cars compared with a year ago, the European Automobile Manufacturers’ Association said yesterday. Sales in Germany, the biggest European auto market, surged 9.1 percent to counteract an ongoing pullback in the UK, where uncertainty over Brexit continues to put off consumers from purchasing new vehicles. Spain also declined.
FOOD
Beyond Meat continues rally
Beyond Meat Inc shares yesterday closed at their highest price yet as short sellers felt the burn to the tune of half a billion US dollars. The shares rose 12 percent to US$169.96, extending a rally that has added almost 600 percent to the stock price since its initial public offering (IPO) last month. That has cost short sellers US$560 million in mark-to-market losses since the IPO, including US$97.5 million in Monday’s session alone, said Ihor Dusaniwsky, managing director of predictive analytics at financial analytics firm S3 Partners.
UNITED KINGDOM
GDP forecast to be flat: poll
The UK economy is likely to flatline in the second quarter and the Bank of England would not raise interest rates until well into next year, a Bloomberg survey showed yesterday. Analysts do not expect the economy to grow at all in the second quarter. They also pushed back expectations for a rate hike to the third quarter of next year from the first quarter.
DIVIDED VIEWS: Although the Fed agreed on holding rates steady, some officials see no rate cuts for this year, while 10 policymakers foresee two or more cuts There are a lot of unknowns about the outlook for the economy and interest rates, but US Federal Reserve Chair Jerome Powell signaled at least one thing seems certain: Higher prices are coming. Fed policymakers voted unanimously to hold interest rates steady at a range of 4.25 percent to 4.50 percent for a fourth straight meeting on Wednesday, as they await clarity on whether tariffs would leave a one-time or more lasting mark on inflation. Powell said it is still unclear how much of the bill would fall on the shoulders of consumers, but he expects to learn more about tariffs
NOT JUSTIFIED: The bank’s governor said there would only be a rate cut if inflation falls below 1.5% and economic conditions deteriorate, which have not been detected The central bank yesterday kept its key interest rates unchanged for a fifth consecutive quarter, aligning with market expectations, while slightly lowering its inflation outlook amid signs of cooling price pressures. The move came after the US Federal Reserve held rates steady overnight, despite pressure from US President Donald Trump to cut borrowing costs. Central bank board members unanimously voted to maintain the discount rate at 2 percent, the secured loan rate at 2.375 percent and the overnight lending rate at 4.25 percent. “We consider the policy decision appropriate, although it suggests tightening leaning after factoring in slackening inflation and stable GDP growth,”
Meta Platforms Inc offered US$100 million bonuses to OpenAI employees in an unsuccessful bid to poach the ChatGPT maker’s talent and strengthen its own generative artificial intelligence (AI) teams, OpenAI CEO Sam Altman has said. Facebook’s parent company — a competitor of OpenAI — also offered “giant” annual salaries exceeding US$100 million to OpenAI staffers, Altman said in an interview on the Uncapped with Jack Altman podcast released on Tuesday. “It is crazy,” Sam Altman told his brother Jack in the interview. “I’m really happy that at least so far none of our best people have decided to take them
PLANS: MSI is also planning to upgrade its service center in the Netherlands Micro-Star International Co (MSI, 微星) yesterday said it plans to set up a server assembly line at its Poland service center this year at the earliest. The computer and peripherals manufacturer expects that the new server assembly line would shorten transportation times in shipments to European countries, a company spokesperson told the Taipei Times by telephone. MSI manufactures motherboards, graphics cards, notebook computers, servers, optical storage devices and communication devices. The company operates plants in Taiwan and China, and runs a global network of service centers. The company is also considering upgrading its service center in the Netherlands into a
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