EUROZONE
Recovery gains pace
The eurozone’s economic recovery unexpectedly gathered pace this month as the bloc’s dominant services industry saw its already buoyant demand rise, more than offsetting a deepening downturn in manufacturing, surveys showed. Hamburg Commercial Bank’s flash composite purchasing managers’ index (PMI), compiled by S&P Global, jumped to an 11-month high of 54.4 this month from last month’s 53.7. That was well above the 50 mark separating growth from contraction, and matched the highest forecast in a Reuters poll that predicted no change from last month. A PMI covering the services industry soared to 56.6 this month from 55.0, confounding expectations in a Reuters poll for a decline to 54.5. Despite high living costs in the eurozone, demand for services improved as consumers continued to spend. The new business index rose to a one-year high of 55.8 from 54.2.
JAPAN
Inflation outpaces forecast
Japanese inflation continued to outpace expectations, adding to intense scrutiny over next week’s Bank of Japan policy meeting, the first under new governor Kazuo Ueda. Consumer prices excluding fresh food rose 3.1 percent last month from a year earlier, matching February’s pace, the Ministry of Internal Affairs and Communications said yesterday. Economists had expected inflation to ease to 3 percent. A separate gauge of price growth that excludes energy and fresh food also proved stronger than expected, climbing to 3.8 percent for its highest reading since 1981. The figure, considered an indicator of underlying price trends, appeared to show unexpected stickiness, even if the margins look relatively small in comparison with other major economies. Forecasting inflation to fall below 2 percent later this year, the bank has said its ultra-easy monetary policy is still appropriate as its inflation target has not been achieved in a sustainable way.
MEDIA
BuzzFeed News shuts down
Pulitzer Prize-winning online media outlet BuzzFeed News is being shut down as part of a cost-cutting drive by its corporate parent, which is shedding about 15 percent of its staff in addition to earlier layoffs. In addition to the news division, layoffs would hit its business, content, tech and administrative teams, Buzzfeed Inc cofounder and CEO Jonah Peretti said in a memo to staff on Thursday. BuzzFeed is also considering making job cuts in international markets. It has about 1,200 total employees, a regulatory filing showed. Peretti said he “made the decision to overinvest” in the news division, but failed to see that the financial support to sustain operations was not there.
AUTOMAKERS
Mercedes profits rise
Mercedes-Benz on Thursday said its operating profit had risen slightly in the first three months of the year, as it was able to shake off high inflation. The German auto group said it recorded an operating profit of 5.5 billion euros (US$6.03 billion), up from 5.2 billion euros in the same period last year. Higher price tags for the group’s vehicles were able to “overcompensate for the negative effects from higher material costs” amid soaring inflation, Mercedes finance chief Harald Wilhelm said in a statement. The improvement came from the strong performance of the automaker’s vans division, as well as “solid growth rates” in sales of electric vehicles and top-end vehicles, Mercedes said. Sales of battery-powered vehicles “almost doubled” in the first quarter to 51,600 units, representing 10 percent of the group’s overall sales.
EXTRATERRITORIAL REACH: China extended its legal jurisdiction to ban some dual-use goods of Chinese origin from being sold to the US, even by third countries Beijing has set out to extend its domestic laws across international borders with a ban on selling some goods to the US that applies to companies both inside and outside China. The new export control rules are China’s first attempt to replicate the extraterritorial reach of US and European sanctions by covering Chinese products or goods with Chinese parts in them. In an announcement this week, China declared it is banning the sale of dual-use items to the US military and also the export to the US of materials such as gallium and germanium. Companies and people overseas would be subject to
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) founder Morris Chang (張忠謀) yesterday said that Intel Corp would find itself in the same predicament as it did four years ago if its board does not come up with a core business strategy. Chang made the remarks in response to reporters’ questions about the ailing US chipmaker, once an archrival of TSMC, during a news conference in Taipei for the launch of the second volume of his autobiography. Intel unexpectedly announced the immediate retirement of former chief executive officer Pat Gelsinger last week, ending his nearly four-year tenure and ending his attempts to revive the
WORLD DOMINATION: TSMC’s lead over second-placed Samsung has grown as the latter faces increased Chinese competition and the end of clients’ product life cycles Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) retained the No. 1 title in the global pure-play wafer foundry business in the third quarter of this year, seeing its market share growing to 64.9 percent to leave South Korea’s Samsung Electronics Co, the No. 2 supplier, further behind, Taipei-based TrendForce Corp (集邦科技) said in a report. TSMC posted US$23.53 billion in sales in the July-September period, up 13.0 percent from a quarter earlier, which boosted its market share to 64.9 percent, up from 62.3 percent in the second quarter, the report issued on Monday last week showed. TSMC benefited from the debut of flagship
TENSE TIMES: Formosa Plastics sees uncertainty surrounding the incoming Trump administration in the US, geopolitical tensions and China’s faltering economy Formosa Plastics Group (台塑集團), Taiwan’s largest industrial conglomerate, yesterday posted overall revenue of NT$118.61 billion (US$3.66 billion) for last month, marking a 7.2 percent rise from October, but a 2.5 percent fall from one year earlier. The group has mixed views about its business outlook for the current quarter and beyond, as uncertainty builds over the US power transition and geopolitical tensions. Formosa Plastics Corp (台灣塑膠), a vertically integrated supplier of plastic resins and petrochemicals, reported a monthly uptick of 15.3 percent in its revenue to NT$18.15 billion, as Typhoon Kong-rey postponed partial shipments slated for October and last month, it said. The
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