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NZ dollar settles lower after rate decision |
WELLINGTON, March 12 (Reuters) - The New Zealand dollar settled off its lows on Friday after the central bank's latest monetary statement cooled expectations about the pace of rate rises and investors sought direction in a choppy market.
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Biofuels study in Cooper Basin |
South Australian resource company Beach Energy and a US business General Atomics are doing a joint study on producing biofuels in the Cooper Basin.
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Airlines set for Asian recovery: IATA |
The global airline industry is heading for far better results this year than expected because of recovery in Asian and Latin American markets, IATA said.
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Warehouse lifts H1 profit 17% |
Retailer The Warehouse lifted half year net profit 17.3 per cent to & #36;NZ57.4 million ( & #36;A44.08 million) as a recovery in overall retail spending remains & quot;patchy & quot;.
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Our Confidence Boom |
This week we have seen & #160;the importance of confidence underlined as a very important (but hard to achieve) part of economic policy.In fact confidence is much easier to lose than to retain; you only have to look at Japan, the US and UK and much of Europe to see the lack of confidence markets and investors (and hundreds of millions of voters) have in their governments' economic management.In Australia, despite the phony campaigns on budget deficits and government debt, confidence remains high among companies and consumers.In fact both are at or near highs not seen for five to seven years.This is reflecting the improvement in the economy, demand for goods and services, rising share and house prices and falling unemployment.The reports on business from the NAB, and from Westpac and the Melbourne Institute on consumer confidence were all extremely solid.The NAB's survey of business conditions was probably the more important, showing demand and activity remains strong, even if there seems to have been a small dip in January and February.As well we saw a strong show of confidence from employers who boosted their job ads last month by a record 19.1%, according to the ANZ's job ads survey.That was strong for newspaper ads and especially so for internet job advertising.And yesterday & #160;we had & #160;further confirmation & #160;of this tide of optimism from the February labour force figures which not only confirmed that & #160;the Australian economic recovery is continuing, but that employers and would-be employees are & #160;now showing more confidence in the future.The unemployment & #160;rate rose to & #160;5.3% because the & #160;initially reported rate for January of 5.3% was revised down to 5.2%.As well, & #160;only a handful of new jobs were created last month, compared with the 54,000 in January.So on the surface, a slowdown.But that didn't tell & #160;all the story.In fact the real story from the February labour force report from the ABS is & #160;this growing confidence from employers and employees alike.The revision in the unemployment rate came from a fall in the participation rate (down 0.1 to 65.2%) and a rise of more than 10,700 people who were looking for work. Of those, more than 9,000 were looking for part time work.In other words, 10,700 people who haven't been encouraged enough in recent months to look for work, have rejoined the ranks of those on the hunt for employment; it's a confidence thing.The number of new jobs increased by just 400, & #160;well down from the sharp increases of the previous three months (especially the 52,700 in January), but that disguised an 11,400 rise in full time employment and a fall of 11,000 in part-time employment.That is classic recovery labour market movement: as employers become more confident about the strength of demand, they employ more people in full time work, usually by shifting people from part-jobs & #160;.That's what's happening now.And another, perhaps stronger indicator & #160;of the continuing strength in demand and activity was the large 2.4% jump in the number of hours worked in February.The rise was almost 36 million hours over the month, and more than reversed the slightly odd fall in January of just over 14 million hours, or 1%. & #160;That confused analysts because it was & #160;accompanied by a sharp rise in job creation and that fall in the unemployment rate to 5.3%.That was a very strong rise and as Macquarie Bank's Rory Robertson has pointed out this increase has all but wiped out the loss of working hours in the 2008-09 slowdown!Now we have a small growth in employment, a rise in full time employment, with an associated fall in part time employment, and a strong jump in the hours worked: all classic labour market theory showing up in practice at the same time.And there was another important measure than went the right way: the ABS's quarterly look at labour under utilisation (that's people unemployed or under employed by being in part time work or on short hours).The ABS said the & quot;Labour Force underutilisation rate decreased 0.6 pts to 12.8%. The male labour force underutilisation rate decreased 0.7 pts to 11.1% and the female labour force underutilisation rate decreased 0.4 pts to 14.9%. & quot;And co-incidentally, the Reserve Bank looked at the performance of the labour market in 2008 and 2009 (during the worst of the slowdown) in its first all electronic edition of its monthly bulletin, the study & #160;concluded: & quot;The Australian labour market fared relatively well during the 2008-2009 downturn, with the unemployment rate rising by less than expected and labour force participation remaining strong. & quot;Much of the weakening in labour demand was reflected in a decline in average hours worked, with firms and their employees negotiating arrangements that preserved jobs. & quot;These outcomes were better than might have been expected, based on the experiences of the early 1980s and 1990s recessions. & quot;And that was confirmed in the labour force stats for February.And the AMP's chief economist, Dr Shane Oliver said in a comment yesterday that the labour force figures were much better than they seemed. & quot;Australian labour force data was broadly as expected in February with employment close to our forecast of flat and unemployment coming in at 5.3%, from a downwardly revised 5.2% in January. & quot;After five consecutive months of strong jobs growth resulting in 197,300 jobs overall, it was inevitable that we would see a somewhat softer month sooner or later and February was it. & quot;However, it is worth noting that the February jobs report is actually better than it looks: full time employment continued to rise, total hours worked rebounded by 2.3% after surprising weakness in January and while unemployment & quot;rose & quot; to 5.3% this only because the unemployment rate in January was revised down to 5.2%. & quot;Business hiring plans and surging job ads suggest that strong employment growth will resume in the months ahead which will likely push the unemployment rate back below 5% by year end & #160;
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Chinese Inflation Up, Cracks Down Further On Housing |
Shock horror, China's consumer inflation is now running at 2.7% and 'house prices boom, bubble, boom and bust' yell the western analysts.It was the 4th successive monthly increase in inflation, but followed eight months of falling prices.But the government is worried about property price inflation: yesterday they revealed home buyers will have to put up a 50% deposit when buying land and banned the sale of land for villas.People buying land at auction will have to put up a 20% deposit.That was after residential and commercial real-estate prices in 70 cities climbed 10.7% in the year to February, up from the 9.5% rate in January.Also in January, the government & #160;reintroduced & #160;a tax on the sale of houses made within five years of their purchase to slow & #160;speculative purchases and so-called & quot;flipping & quot;.The government said that & #160;consumer prices increased & #160;2.1% in January and February, & #160;from the same period in 2009. & #160;There will be a lot more of this boom and bust commentary in coming months until China brings inflation under control.But in the meantime Australian taxpayers, shareholders and companies (such as BHP and Rio) will have a vested interest in cheering on inflation because they will be riding it for every last dollar; after all they have a vested interest, and are part of the cause.Producer-price inflation climbed to 5.4% in February from 4.3% in January.Banks extended 700 billion Yang ( & #36;US112 billion) of new loans in February, down from & #160;1.39 trillion Yang in the previous month and 1.07 trillion Yang in February of last year.Retail sales rose 17.9% in the first two months from a year earlier, and urban fixed-asset investment gained 26.6%.Retail sales grew 22.1% in February, but that was boosted by the Lunar New Year holiday.Production grew & #160;20.7% in the first two months of the year after an 18.5% rise in December.Crude steel production jumped 22.5% in January and February to 102.89 million tonnes, with February's figure up 22% at 50.36 million tonnes (meaning January's figure was a much higher than expected 52.53 million tonnes). & #160;Iron ore imports rose 5.6% to 49.38 million tonnes. & #160;Over the first two months of the year ore imports rose 21% to more than 96 million tonnes.No wonder iron ore prices are around record levels, and no wonder the Brazilian exporter, Vale, is asking for a 90% price rise.So after these figures, watch for a rate rise; the last rate rise was in December 2007. One will happen in coming months.The central bank has lifted the asset reserve ratio twice and also engineered two small increases in money market rates, while it and the banking regulator have ordered banks to cut lending and to redirect loans to more productive parts of the economy.The one-year lending rate is at 5.31% and deposit rate is at 2.25%.China has & #160;pegged the Yang at about 6.83 per & #160;US dollar since July 2008 to help exporters.Last weekend, Premier Wen Jiabao pledged to & #160;hold full-year inflation around 3% and GDP & #160;growth was again set at the standard 8% a year (10.7% annual rate in the 4th quarter of 2009).Australian companies and taxpayers will be beneficiaries of this inflation and growth..BHP Billion won price rises of 55% for coking coal this week from major buyers in Asia and Europe. & #160;Chinese steel mills will pay this, and thermal coal buyers will as well when the price rise triggers a rise in steaming coal prices.Iron ore prices in China could rise by 50% or more after BHP, Rio Tinto and Vale of Brazil win big price increases from Japanese and Korean mills, and then tell China they will have to pay.By some estimates, this could boost steel prices in Asia by 30% over the next year.That will lift the cost of cars, building, whitegoods and other products at a time when the government is trying to stimulate domestic demand.So while the price rises will be music to the balance sheets of Australian and other global resource companies, there will be a danger in the price rises boosting inflation further.Chinese spending will fall over the year from last year's frenetic levels. But from the government's point of view it will be a steady as she goes year.Apart from the economic reasons, there's a political reason for this as well.Complicating these pronouncements to the annual National People's Congress in Beijing is the knowledge that at sometime in the next year, the replacements for the changeover of power in 2012 will be made known.President Hu Jintao and Premier Wen Jiaboa are both to retire in 2012. & #160;We have seen the start of campaigns from other senior officials for advancement, but so far the likely successors to the two leaders are not known. & #160;
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Some 24,000 hit by stolen HSBC Swiss bank data |
GENEVA (AFP) - Some 24,000 customers may have been affected by the theft of data from a Swiss branch of banking giant HSBC three years ago, Alexandre Zeller, chief executive of HSBC Private Bank, said on Thursday.
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BMW posts 36.5% drop in 2009 profit |
FRANKFURT (AFP) - BMW, the world's leading luxury car maker by sales, on Thursday reported a sharp drop in 2009 profit but said deliveries would pick-up this year.
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Oil steadies after recent surge |
LONDON (AFP) - Oil prices held steady on Thursday as investors paused for breath following recent gains made after data that showed stronger US energy demand, analysts said.
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Violence erupts at Greek demonstrations |
Violence erupted on the sidelines of a Greek protest against government austerity measures, with riot police firing tear gas at hooded youths hurling firebombs.
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