CHINA'S ECONOMIC BOOM CONTINUES
China's economy grew strongly
in the first nine months of the year, despite efforts by the government
to put the brakes on growth.
The National Bureau of
Statistics said the economy was 9.4% bigger than a year ago, but said
that trade imbalances threatened economic stability.
The government is encouraging
domestic demand, while trying to reducing reliance on investment and
It also has concerns about
agriculture, and high levels of government spending.
It was the ninth straight
quarter of annual growth of 9% or higher, and followed rises of 9.5% in
the second quarter and 9.4% in the first.
National Bureau of Statistics
spokesman Zheng Jingping said: "The nation's economy has continued
to develop towards the target of macro-regulation as a good momentum of
steady and rapid growth is maintained."
We are concerned the
overheating fixed asset investment has still not yet been effectively
Total GDP for the nine months
from January to September grew to total 10.627 trillion yuan ($1.3tr;
The government has attempted to
slow the economy by putting interest rates up, revaluing the yuan, and
restricting credit levels.
It is also trying to limit
investment in industries such as steel, cement and aluminium, but
high-tech industries are still investing heavily.
There are have been growing
concerns about an economic imbalance between urban and rural prosperity
and investment, with many people moving from the countryside to the
The latest economic report
acknowledged that Chinese farmers' incomes are not growing fast enough.
US 'STILL GREW AFTER
The US economy has kept growing
despite the negative effects of hurricanes Katrina and Rita, and surging
oil prices, the Federal Reserve has said.
In its Beige Book survey, the
Fed said that economic activity continued in September and into early
While the hurricanes have not
slowed growth, they have had an impact.
The Fed said that its 12
regional banking regions reported an increase energy and fuel costs,
some of which were being passed on to consumers.
"All districts reported
cost increases for energy, petroleum-based products, building materials,
and shipping," the Fed said.
Analysts said that it was
likely that the Fed would continue with its steady increases to
US interest rates have risen to
3.75% from 1% as the economy has improved and the rate of inflation has
come under pressure.
The damage from hurricanes will
pressure prices in coming months
While the economy is still
expanding, the Fed said that growth is gradual or moderate, with some
regions experiencing more problems than others.
The Atlanta and Dallas
districts, which contain areas hit by the hurricanes, saw a slowdown in
Within Atlanta, "economic
activity remained severely disrupted in costal Louisiana and
Mississippi", the Fed said.
Dallas includes the coast of
Texas and northern Louisiana.
There also was a slowdown in
The housing market remained
generally strong, while retail sales growth was weaker than usually in a
number of districts. Car sales also dipped.
TOURISM 'BOOSTS UK ECONOMY BY
The UK economy benefited from
tourism to the tune of £81.5bn in 2004, says the British Hospitality
The trade association for
restaurants, hotels and caterers said eating and drinking away from the
home formed the majority of the leisure earnings.
The first was worth £20.1bn
and the latter £15.9bn. Business-related spending was valued at
£10.2bn and overnight accommodation at £9.9bn.
The London Eye was the top
charging attraction with 3.7 million visitors.
The BHA report, supported by
American Express and research company Horizons, also revealed more than
110 hotels will have opened in the UK between September 2004 and
And the London bombings in July
do not seem to have an adverse effect on numbers.
US BUDGET DEFICIT SHRINKS IN
The US budget deficit shrank to
$319bn (£180bn) last year as better economic conditions boosted tax
Despite falling from 2004's
record $412bn figure, the federal deficit for the fiscal year ending
last month was still the third highest on record.
US Treasury Secretary John Snow
hailed the fall, which was larger than had been projected, as
However, this year's deficit is
likely to be swelled by $30bn of spending on post-Hurricane Katrina
According to figures from the
US Treasury Department, only $4bn of the $62bn allocated by Congress in
emergency aid for Hurricane Katrina was spent in the last fiscal year.
When it reconvenes, the House
of Representatives will begin the task of identifying $35bn worth of
cuts to federal spending needed to offset hurricane recovery costs.
The 2005 fiscal year deficit
amounted to 2.6% of GDP, below the 3.6% recorded in 2004 and the post
World War Two high of 6% in 1983.
DOLLAR OFF GAINS ON EU INDUSTRY
The dollar soared against the
euro and the yen on Wednesday last but profit-taking and a stronger than
expected report on industrial performance in the eurozone wiped out much
of the gain.
The single European currency at
one point fell below the 1.19-dollar level for the first time since
early July, dropping to $1.1876, before rebounding strongly.
Against the yen the dollar
jumped to 115.99, its highest level since September 2003.
The euro in later trade was at
$1.1987, against $1.1957 late Tuesday in New York and 115.50 yen after
115.67 on Tuesday.
American Airlines expects to
pay $2.17 per gallon of jet fuel in 2006, which would mean a $1.1bn
increase in its fuel bill next year compared with its forecast 2005
total, its chief financial officer said on Wednesday. James Beer also
said the AMR Corp unit expects consolidated capacity to edge up 0.8pc in
the 4th quarter, while the number of available seats would be
"relatively flat" next year.
ABBAS TO MEET BUSH AT WHITE
US President George W Bush is
due to meet Palestinian leader Mahmoud Abbas, amid worsened relations
between the Palestinians and the Israelis.
Mr Bush is expected to ask Mr
Abbas to do more to halt violence against Israel after an attack on
settlers on Sunday.
Mr Abbas is expected to ask the
US to put pressure on Jerusalem to dismantle settlements not authorised
by Israel and to allow a free Palestinian poll. Their White House talks
are the first since Israel left Gaza last month.
IRAQ PROMISES OIL EXPORT GROWTH
Iraq is on course for a 20%
rise in its oil exports by the start of 2006, the head of its energy
Ahmad Chalabi said output for
export should hit 1.8 million barrels a day by January, when elections
take place and a new administration takes power.
Talking to Reuters, he backed
the idea that US and UK oil firms should have priority in Iraq's oil
Mr Chalabi, once a US favourite
to lead Iraq before falling out with Washington DC, is now a key
Previous optimistic forecasts
of growth in oil production and export have frequently proved
The shortfalls are the product
of problems with equipment after years of neglect, and the impact of an
insurgency which frequently targets both oil installations and the
OIL PRICES DOWN ON WILMA
Oil fell below $62 a barrel in
early Asian trading on Thursday last, after a day of fluctuating prices
as Hurricane Wilma approached the US.
Market sentiment changed as
Wilma appeared to be heading towards Florida rather than the Gulf Of
Mexico, where two previous hurricanes hit output.
Growing US crude and petrol
inventories and signs of weakening demand also contributed to the price
US light crude futures slid 43
cents, or 0.7%, to $61.98 a barrel.
Oil prices soared above $70 a
barrel in August, but have been fluctuating around the mid-sixties since
The market has been on a
three-day falling run, shedding 3.7% a barrel during that time. Early on
Thursday a barrel of London Brent crude was also down, by 33 cents to
PARIS CLUB AGREES NIGERIA DEBT
The Paris Club of creditor
nations has agreed a debt relief deal with Nigeria worth $18bn (£10bn).
The club said it was impressed
by an economic programme implemented by Nigerian authorities since 2003.
The deal will see Nigeria pay a
chunk of its debt arrears, receive debt relief on two-thirds of eligible
debts and buy back the last third.
About $30bn of Nigeria's debt
is owed to members of the 19-nation-strong Paris Club.
Online auction site eBay has
reported a 40% rise in quarterly profits, helped by increasing sales in
Europe and Asia.
Net income in the third quarter
ending 30 September was $255m (£144.7m) from $182.3m a year earlier.
International sales increased 43% to $408.9m.
The battle to keep fares lower
in the face of competition from airlines and ferry operators has hit
Eurotunnel's cross-channel passenger business.
Revenues slipped at its
passenger shuttle division in the third quarter, though the actual
number of passengers travelling increased.
US BANKS BUOYED BY BETTER
US bank earnings have received
a boost from better performance in stock, bond and commodity trading, as
well as a spate of mergers and acquisitions.
JP Morgan and Merrill Lynch
have reported record quarterly profits, with Bank of America seeing a
solid rise. Banking giant Citigroup also released good earnings news
earlier this week.
Chipmaking giant Intel, a
bellwether for the technology and computer industry, said that third
quarter profits rose, lifted by steady demand.
Net income rose 5% to $2bn
(£1.1bn) in the three months ending 1 October, from $1.91bn a year
earlier. Sales during the period rose 18% to $9.96bn.
Entrepreneur Philip Green's
Arcadia Group has posted a small rise in annual profits as conditions on
the High Street continue to challenge retailers.
Pre-tax profits at the
privately held group rose to £252.79m, compared to profits of £246.33m
last year. .
BROWN 'ON THIN ICE WITH
Chancellor Gordon Brown is
skating on thin ice when it comes to the economy, a leading forecasting
group has warned.
The Ernst and Young Item Club -
which uses the Treasury's own economic model to gauge the UK economy -
says it will only grow at 1.6% this year.
In the last Budget, the
chancellor had predicted growth of 3% to 3.5%.
The group added that Mr Brown
had failed to heed signs of a slowdown, and could not blame external
factors such as rising oil prices for the problem.
"The chancellor is blaming
the UK economic slowdown on the recent spike in oil prices and the
weakness of the European economy, but this is unrealistic," the
Item Club's chief economic adviser Professor Peter Spencer said.
US WHOLESALE PRICES JUMP ON OIL
US inflation worries have been
stoked up after wholesale prices posted their biggest monthly gain in 15
The producer price index jumped
by 1.9% in September from a year earlier, the US Labor Department said.
Analysts had expected a figure closer to 1.1%.
Stocks and bonds fell on the
news amid concerns that corporate profit growth will slow and interest
rates will rise. Consumer prices are rising by 4.7% annually on higher
fuel and food costs.
ENERGY PRICES STOKE US
Inflation in the US shot up in
September as food and fuel prices took their toll on household budgets.
Prices surged 1.2% last month -
more steeply than expected - bringing the rate for the past 12 months to
But leaving out food and fuel -
and thus the recent increases in petrol and heating oil following
Hurricane Katrina - inflation was just 0.1%.
President George W Bush's
spokesman said he was confident that the Federal Reserve could handle
The surging inflation rate has
been caused by a supply bottleneck for energy in the US, after a huge
slice of US refinery capacity was put out of action by hurricanes
Katrina and Rita.