Daily Archives: April 6, 2011

Brazil engages in currency ‘psyops’

April 6, 2011 10:05 pm by beyondbrics

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By Joe Leahy and Samantha Pearson in São Paulo

Before 3pm on Wednesday, traders of the Brazilian real were quaking in their boots. Guido Mantega, Brazil’s finance minister and currency warrior, was going to make an announcement. Was this going to be the big one? Was he at last going to announce a higher transactions tax on stocks or bonds purchases in his bid to prevent short-term foreign currency inflows from driving up the value of Brazil’s currency, the real?

No, said finance ministry officials. He ended up instead announcing the appointment of a new official to state bank, Banco do Brasil. Continue reading »

[snap] Portugal asks for EU bail-out

April 6, 2011 9:19 pm by Stefan Wagstyl

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It came as no surprise on Thursday but was still a shock to see a third European Union country turn to Brussels for a financial rescue.

As ft.com reported, Portugal joined Greece and Ireland in needing assistance after being forced to borrow at “prohibitive” rates.

Related reading
Euro in crisis, in depth, ft.com

Tags: debt, monetary policy Posted in Europe | Permalink

Americas market wrap

April 6, 2011 7:55 pm by Anora Mahmudova

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Latin American markets started the day on a high note on Wednsday, but fell back by the close. Brazilian investors worried that the government would announce new currency controls to stem real’s gains and sold off the equities. The MSCI Latin America index fell 0.3 per cent to 4,716. Continue reading »

Posted in Global | Permalink

[snap] Brazil’s currency warriors back from lunch

April 6, 2011 6:32 pm by beyondbrics

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After a relaxing lunch break, the currency war is back on in Brazil. Guido Mantega, the country’s finance minister, is now set to make a second announcement on Wednesday at 6.30pm Brasília time on Wednesday (22:30 GMT), which will focus on currency measures aimed at curbing Brazil’s overvalued real.

The announcement of a meeting at 3pm originally spooked the market but that is instead expected to focus on state-run bank Banco do Brasil.

Finance Ministry 1: Currency Market 0

Posted in Brazil, LatAm | Permalink

Poland’s pensions: revolution no more?

April 6, 2011 5:30 pm by Jan Cienski

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Poland used to be the country that romanticised revolution against crushing odds – but now, more than two decades after the end of communism – the issue gripping Poles is pensions: when they retire, with how much, and who will get the best benefits.

The government has now weighed in, having brought the issue to the fore a few months ago when it decided to reform the pension system in order to help public finances. Bronislaw Komorowski, the president, is expected to sign the legislation into law this week that reduces the amount of money flowing into private pension funds, instead redirecting it into the public pension system. Continue reading »

Tags: economy, pensions Posted in Poland | Permalink

Oil price: no panacea for Russia

April 6, 2011 4:46 pm by Courtney Weaver

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For eight years, the oil price and Russia’s economic growth fit together like two peas in a pod. But no longer.

While Russia’s economic development ministry has raised its 2011 forecast for the oil price by 30 per cent from $81 to $105 a barrel, it has kept its forecast for gross domestic product growth the same, at 4.2 per cent.

What gives? According to economists and analysts, it comes down to pre-election social spending – and Russia’s oil and gas sector becoming a secondary driver of the economy. Continue reading »

Tags: GDP, inflation, oil & gas Posted in Russia | Permalink

Deal of the Day: India’s Genpact buys Headstrong for $550m

April 6, 2011 4:03 pm by James Fontanella-Khan

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Genpact, India’s biggest business-processing company, acquired Headtstrong, a consulting and IT services group, for $550m, a deal that highlights the ongoing consolidation drive throughout the outsourcing sector.

The deal sealed by Genpact, which was spun off by General Electric in 2005, also emphasizes the attempt of Indian IT groups to build a more integrated business model similar to US multinationals such as Accenture and IBM. Continue reading »

Tags: IT Posted in India | Permalink

Peñoles reaps benefit of booming silver

April 6, 2011 3:23 pm by Adam Thomson

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When the price of silver hits a 31-year high, as it did on Wednesday – at $39.53 an ounce – it doesn’t get much better than being Peñoles, the Mexican mining company. Continue reading »

Tags: commodities Posted in Mexico | Permalink

[snap] Brazil won’t move on currency

April 6, 2011 2:55 pm by beyondbrics

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Guido Mantega, Brazil’s finance minister, is to make a statement at 3pm Brasília time on Wednesday (19:00 GMT). There has been speculation that Mantega will announce new capital controls or other measures to stop the currency’s steady climb.

He won’t. The finance ministry has told beyondbrics there will be no such announcement and that Mantega is due to talk about Banco do Brasil, the state-controlled bank. Traders can relax, for now.

Tags: currencies, monetary policy Posted in Brazil, LatAm | Permalink

Kuwait’s Stock Exchange: gambling den no more?

April 6, 2011 1:20 pm by Robin Wigglesworth

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Kuwait’s stock market may be one of the oldest and largest in the Arab world, but has long been synonymous with rampant market abuses such as insider trading and pump-and-dump trading by powerful merchant investors. That may be about to change.

Spurred on by the financial crisis, which caused the exchange to shed almost two thirds of its market capitalisation, Kuwait last year introduced a new regulatory framework, and this year established a dedicated Capital Markets Authority to enforce the new rulebook. Continue reading »

Posted in Kuwait | Permalink

KKR and Yageo: going private

April 6, 2011 12:57 pm by Robin Kwong

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Will Taiwan’s component manufacturers suffer from supply-chain disruptions caused by Japan’s devastating earthquake, tsunami and nuclear disaster? No, say sell-side analysts: it’s a buying opportunity.

They would say that, perhaps. But private equity group KKR and Pierre Chen, founder and chairman of Yageo, a maker of chip resistors, weighed in behind that argument on Thursday as they launched a bid to take the company private. Continue reading »

Posted in Asia, Taiwan | Permalink

SK on inflation: sign of desperation?

April 6, 2011 12:18 pm by Song Jung-a

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South Korea’s government appears ready to do whatever it takes to dampen rising inflation, which has spiked to a 29-month high of 4.7 per cent in March.

In a move to curb domestic oil prices, commerce ministry on Wednesday that the government would consider cutting oil taxes. Controversially, it has also pressured oil refiners to cut their prices, the latest move which indicates the government is seeking to bolster public support for the ruling party ahead of the parliamentary election next year.

Tags: inflation, politics Posted in South Korea | Permalink

New York headlines

April 6, 2011 12:03 pm by beyondbrics

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* China’s rate tightening threatens copper

* Inflation a threat to sustained Asian recovery – ADB

* Oil hits $120 after strike in Gabon

* Ouattara forces storm Gbagbo bunker in Ivory Coast

* US close to deal with Colombia on trade pact Continue reading »

Posted in Global | Permalink

UAE: here comes the (long, hot) summer

April 6, 2011 11:21 am by James Drummond

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No one yet wants to predict the economic impact of the ongoing unrest that is gripping the Arab world. For the likes of Egypt, Tunisia and Bahrain, which are not big oil exporters, the mind boggles.

But elsewhere it is not all bad news. The seven emirates of the UAE – well, two of them – have been having a solid 2011. Whisper it quietly but Dubai, a sunny place for shady people, has been doing rather nicely. It is quite like the old days. Continue reading »

Tags: Arab spring, FDI, investment Posted in Middle East, United Arab Emirates | Permalink

Indian telecoms: deal or no deal?

April 6, 2011 11:17 am by James Fontanella-Khan

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Vodafone announced last week that it would pay $5bn to buy the Essar conglomerate out of the UK mobile phone group’s Indian business. Although the deal was expected as part of a pre-agreed “put and call option” between the partners, the move immediately raised a key question: will there be more M&A in Indian telecoms?

The answer, according to most telecom analysts, is yes – but not right now. Continue reading »

Posted in India | Permalink

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Daily Archives: April 6, 2011

Brazil engages in currency ‘psyops’

[snap] Portugal asks for EU bail-out

Americas market wrap

[snap] Brazil’s currency warriors back from lunch

Poland’s pensions: revolution no more?

Oil price: no panacea for Russia

Deal of the Day: India’s Genpact buys Headstrong for $550m

Peñoles reaps benefit of booming silver

[snap] Brazil won’t move on currency

Kuwait’s Stock Exchange: gambling den no more?

KKR and Yageo: going private

SK on inflation: sign of desperation?

New York headlines

UAE: here comes the (long, hot) summer

Indian telecoms: deal or no deal?

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