UNITED STATES
Slowdown ‘required’: Fed
A slowdown of economic growth and the job market will be “required” to bring down inflation, the Federal Reserve said in notes released on Wednesday, adding that prices remain “unacceptably high.” Fed officials also said inflation has “not yet responded” to increased interest rates, according to minutes of the central bank’s meeting last month, and that “a significant reduction in inflation would likely lag that of aggregate demand.” However, some of the Fed officials cited in the minutes also said that “it would be important to calibrate the pace of further policy tightening with the aim of mitigating the risk of significant adverse effects on the economic outlook.”
NEW ZEALAND
Houses taking longer to sell
Houses are taking longer to sell as rising interest rates put off buyers and listings decline, resulting in the lowest number of completed transactions in more than a decade. The median time to sell a house last month was 47 days, Real Estate Institute of New Zealand data showed yesterday. That is up from 37 days a year earlier and as little as 28 days early last year. House sales fell below 16,000 in the three months through June, the weakest quarter since 2010, CoreLogic New Zealand data showed. Prices have dropped by 12.6 percent from a peak in November last year.
UNITED KINGDOM
Minister blames BOE
Chancellor of the Exchequer Kwasi Kwarteng said that the Bank of England (BOE) would be responsible if British markets suffer renewed volatility after its bond-buying program ends today. Speaking on the sidelines of the IMF’s annual meetings in Washington, Kwarteng told Sky News that any turmoil after the central bank withdraws support “is a matter for the governor.” BOE Governor Andrew Bailey this week underlined his commitment to halting government debt purchases today as planned, both to draw a line under a program that is complicating his efforts to tame inflation and to encourage pension funds to get on with closing their positions.
APPAREL
Fast Retailing issues outlook
Uniqlo owner Fast Retailing Co issued an outlook for profit and sales ahead of analysts’ projections for the current fiscal year, thanks to better demand for its cheap casual apparel in Japan and a weaker yen bolstering profits brought back home from overseas. Operating profit for the year ending August next year is forecast to reach ￥350 billion (US$2.4 billion), the clothing retailer said in a statement yesterday. Net sales are seen at ￥2.65 trillion, compared with analysts’ prediction for ￥2.48 trillion. For the year ended August, operating profit rose to ￥297 billion on net sales of ￥2.3 trillion, the company said, exceeding projections.
FRANCE
Tax hike bill approved
Lawmakers in the National Assembly late on Wednesday voted in favor of an amendment that would raise taxes on large corporation’s dividends paid out on windfall profits. The amendment was voted through by lawmakers from the left, far-right, but also by some of French President Emanuel Macron’s allies in the centrists, who originally proposed it. The government could still block the temporary tax increase with special constitutional powers to quash amendments before a final vote on the whole 2023 budget bill in both houses of parliament.
JITTERS: Nexperia has a 20 percent market share for chips powering simpler features such as window controls, and changing supply chains could take years European carmakers are looking into ways to scratch components made with parts from China, spooked by deepening geopolitical spats playing out through chipmaker Nexperia BV and Beijing’s export controls on rare earths. To protect operations from trade ructions, several automakers are pushing major suppliers to find permanent alternatives to Chinese semiconductors, people familiar with the matter said. The industry is considering broader changes to its supply chain to adapt to shifting geopolitics, Europe’s main suppliers lobby CLEPA head Matthias Zink said. “We had some indications already — questions like: ‘How can you supply me without this dependency on China?’” Zink, who also
At least US$50 million for the freedom of an Emirati sheikh: That is the king’s ransom paid two weeks ago to militants linked to al-Qaeda who are pushing to topple the Malian government and impose Islamic law. Alongside a crippling fuel blockade, the Group for the Support of Islam and Muslims (JNIM) has made kidnapping wealthy foreigners for a ransom a pillar of its strategy of “economic jihad.” Its goal: Oust the junta, which has struggled to contain Mali’s decade-long insurgency since taking power following back-to-back coups in 2020 and 2021, by scaring away investors and paralyzing the west African country’s economy.
BUST FEARS: While a KMT legislator asked if an AI bubble could affect Taiwan, the DGBAS minister said the sector appears on track to continue growing The local property market has cooled down moderately following a series of credit control measures designed to contain speculation, the central bank said yesterday, while remaining tight-lipped about potential rule relaxations. Lawmakers in a meeting of the legislature’s Finance Committee voiced concerns to central bank officials that the credit control measures have adversely affected the government’s tax income and small and medium-sized property developers, with limited positive effects. Housing prices have been climbing since 2016, even when the central bank imposed its first set of control measures in 2020, Chinese Nationalist Party (KMT) Legislator Lo Ting-wei (羅廷瑋) said. “Since the second half of
AI BOOST: Next year, the cloud and networking product business is expected to remain a key revenue pillar for the company, Hon Hai chairman Young Liu said Manufacturing giant Hon Hai Precision Industry Co (鴻海精密) yesterday posted its best third-quarter profit in the company’s history, backed by strong demand for artificial intelligence (AI) servers. Net profit expanded 17 percent annually to NT$57.67 billion (US$1.86 billion) from NT$44.36 billion, the company said. On a quarterly basis, net profit soared 30 percent from NT$44.36 billion, it said. Hon Hai, which is Apple Inc’s primary iPhone assembler and makes servers powered by Nvidia Corp’s AI accelerators, said earnings per share expanded to NT$4.15 from NT$3.55 a year earlier and NT$3.19 in the second quarter. Gross margin improved to 6.35 percent,
RSS