Chilean stocks sink in first trading after quakeChile's benchmark stock index dropped sharply Monday as the nation struggled to recover from a massive earthquake over the weekend. Chile's IPSA fell 105 points, or 2.8%, to 3,722. Other regional markets advanced. Brazil's Bovespa added 0.7%, or 444 points, to 66,947.
India Oct.-Dec. GDP grows lower-than-expected 6%RBA hikes policy rate by 25 basis points to 4.0%China's consumer prices rise more than expectedChina's consumer price index accelerated to a pace of 2.7% in February from the year-earlier month, driven by a surge in food prices, according to official data released Thursday. The increase was higher than the 2.4% rise estimated by analysts in a Dow Jones Newswires survey, and was above the 1.5% increase in January's CPI. Food prices jumped 6.2% during the month, driving the price index higher. February's producer price index accelerated 5.4% from the year-earlier period, also beating forecasts of a 5% increase.
China Feb. trade surplus narrows to $7.6 billion - MarketWatchChina's trade surplus narrowed further to $7.6 billion in February from $14.2 billion in January on surging imports even as the nation's exports continued to rise rapidly, according to reports. Economists surveyed by Reuters had estimated a surplus of $8 billion, while a Dow Jones Newswires poll had penciled in a trade surplus of $6.4 billion. February exports jumped 45.7% from the same month of 2009, while imports expanded by 44.7%. But compared to January, exports were down 2.2% on a seasonally adjusted basis, helping drive down the surplus.
Japan keeps rates steady, expands loan programThe Bank of Japan kept its key policy interest rate unchanged at 0.1% Wednesday, as had been widely expected, and announced plans to double the scale of a 10 trillion yen ($111 billion) lending program introduced in December. Japanese stocks strengthened, as did the yen, following the news. One U.S. dollar bought 90.09 yen, down from 90.35 yen ahead of the announcement. The Nikkei 225 Average was up 0.9%, compared with a rise of 0.7% prior to the news.
David Smith's EconomicsUK.com: Exports lift manufacturing to 15-year highJapan's Central Bank Holds Much of Japan's Debt-Dean BakerAn AP story in the Washington Post on the IMF's warnings about debt levels told readers that: "Japan's debt is proportionately even bigger -- about twice its GDP -- but the impact is cushioned because most is held by Japanese households." Actually the fact that the debt is mostly held by Japanese households by itself is of little consequence. If Japan had been running large trade deficits and foreigners had bought private assets but not government bonds, then Japanese households and its economy would be in the same situation as if foreigners had bought its debt. The key point is that Japan has been running trade surpluses so that it has accumulated foreign assets rather than selling off domestic assets.
It is important that a very high portion of Japan's debt is held by its central bank. This means that the interest on the debt is paid to the bank. It is then refunded to taxpayers so this debt does not impose any burden whatsoever.
--Dean Baker
Trade deficit likely in March - People's Daily OnlineGermans think they would be better off outside the euro areaFT/Harris poll says majority of Germans wants Greece out of the euro, oppose help to Greece, and long to get out themselves; results show sharp contrast with public opinion elsewhere in the euro area; Merkel goes on radio to warn against expecting a deal on Greek aid; Barroso, meanwhile, calls on European Council decide aid package this week; Wolfgang Munchau says present German policies are inconsistent with a survival of the euro area; Martin Taylor says the best solution for the euro area would be a split into a northern and a southern part; Harold James says the real problem in the global monetary system is the lack of policy co-ordination, and Europe’s tragedy consists of the attempt to try to solve this problem at regional level; the second round of voting in France’s regional elections confirms the route of the UMP, as the Socialists take 54%; French commentators, meanwhile, are questioning whether Nicholas Sarkozy can still regain the French presidency in 2012.
Bank of Japan tankan survey shows improvementThe Bank of Japan's quarterly tankan survey of business sentiment released Thursday showed that the diffusion index for large manufacturers improved to minus 14, matching the forecast of economists surveyed by Dow Jones Newswires, and rising from minus 25 in the December survey. The headline figured improved for the fourth straight quarter, but a negative reading still shows more companies are pessimistic than optimistic. The March tankan also showed that large companies plan to cut their capital expenditures by 0.4% in the fiscal year which begins Wednesday, better than the consensus estimate for a cut of 0.8%.
Australia hikes policy rate by quarter pointBOJ holds steady; says economy 'picking up'The Bank of Japan's policy board unanimously voted Wednesday to keep its key interest-rate target steady at 0.1% as widely expected, as it gauges the effects of its liquidity-boosting steps. In the statment issued at the conclusion of its regular two-day policy meeting, the central bank maintained its overall assessment that the country's economy has been "picking up, mainly due to improvement in overseas economic conditions and to various policy measures," though it also continued to say that domestic private demand lacks sufficient momentum to support a self-sustaining recovery. BOJ Gov. Masaaki Shirakawa will hold a regular post-meeting briefing later Wednesday.
China's Q1 GDP rises a more-than-expected 11.9% - MarketWatchChina's first-quarter gross domestic product rose 11.9% from the year-ago period, beating consensus forecasts, the National Bureau of Statistics said Thursday. Separate polls by Dow Jones Newswires and Reuters had expected GDP growth of 11.5%. The result was also above the 10.7% year-on-year increase posted in the last quarter of 2009. On the inflation front, March's consumer price index was 2.4% higher than a year earlier, while the producer price index was up 5.9%. Both Dow Jones Newswires and Reuters had expected a 2.6% rise in CPI, compared with February's 2.7% gain. [Corrects the March PPI rise figure]
Fiscal plans to dominate U.K. election Hung parliament fears pressure British pound
