Daily Archives: Mar 22, 2012

More good news for the government of President Dilma Rousseff on Thursday. Inflation slowed much more than the market expected in the 12 months to mid-March, easing to 5.61 per cent from 5.98 per cent in the previous reading.

This is supportive not only of the government’s policy of trying to quickly push down the benchmark Selic interest rate but of also another official priority – encouraging a weaker exchange rate. Read more

Operation dissuasion has begun. As promised last week Argentina said on Thursday it had sent letters to the London and New York Stock Exchanges urging them to demand full information from the AIM-listed junior companies exploring around the Falkland Islands and the companies involved with them about their “illegal” activities.

Though Argos Resources, Borders & Southern , Desire, Falkland Oil & Gas (FOGL) and Rockhopper are not listed in New York, a letter was sent to the New York Stock Exchange in case they considered listing there. Read more

Thomas Mirow, EBRD presidentJockeying among the European Union countries for top eurozone financial jobs has thrown into question the chances of Germany’s Thomas Mirow (pictured left) of winning a second four-year term as president of the European Bank for Reconstruction and Development.

That could yet lead to a real contest for the first time for leadership of the bank, set up two decades ago to assist eastern Europe’s post-communist transformation. Read more

It is a battle of hearts and minds, millions of viewers and billions of euros of advertising revenue and it seems to set Turkey’s powerful prime minister against the pharaohs of football.

At issue is Turkey’s match-fixing scandal – an affair that allegedly involves eight clubs and which has sparked off a criminal court case in which 93 people are on trial, including the chairman of Fenerbahce, the  Turkish league champions. Read more

When trying to predict the outcome of a race, it’s always useful to see where the smart money is going. So it’s with a heavy heart that beyondbrics reports on the odds of the two emerging market candidates for the World Bank. Read more

Central Asia is mainly known for its abundant hydrocarbon reserves – but some countries in the region are already turning their attention to wind resources to produce cleaner, renewable energy.

Mongolia has set an ambitious goal to become central Asia’s renewable energy champion even as foreign investors compete for access to its huge coal mines. Strong winds gusting across the empty steppe could eventually be harnessed to produce about one quarter of the country’s energy needs. Read more

Investors don’t like uncertainty – and it doesn’t come much bigger than a military coup. After soldiers in Mali staged a mutiny in the capital, cutting off state media broadcasts and firing on the presidential palace, London-listed miner Randgold has seen a big fall in its share price.

The miner was off 17 per cent at one point on Thursday – at time of writing it is down 10.08 per cent. The company reported normal operations, but that hasn’t stopped investors taking fright. Read more

Ukraine has joined the growing band of central and east European countries to cut interest rates in response to slower growth.

The National Bank of Ukraine announced on Thursday that it was taking down its refinancing rate by 25 basis points to 7.5 per cent – the first cut since August 2010.

It follows growth-boosting reductions elsewhere in CEE in recent months, including in Serbia and Romania. But the easing is by no means universal, with Russia, Poland and the Czech Republic all holding firm and Hungary raising rates to protect a weak currency. Read more

Standard Chartered must like a challenge because it has just taken on a tough one: helping troubled Vietnam improve its sovereign credit ratings.

The Vietnamese government, which is battling deep-seated problems in banking state-owned enterprises, on Thursday appointed the emerging market-focused bank as its sovereign credit ratings adviser, Standard Chartered said. Read more

Although emerging Asian equities have matured and now trade at parity with the US, there is still a long way to go in terms of risk management products. Jeremy Grant and John Authers explain.

* Singh under fire over new India scandal

* China and Australia in $31bn currency swap

* Stocks slip on China and Europe worries

* China: PMI/Japan point to slowdown Read more

There are 1.2bn people in India. But just 32.4m of them – less than 3 per cent of the population – pay income tax.

India’s tax department will collect around $30bn of income tax in the fiscal year ending March 31, according to a report by the parliamentary standing committee on finance. Of that, $3bn will come from 29m taxpayers earning less than $10,000 a year. So 10 per cent of the total collected will come from just under 90 per cent of those paying. Read more

By Kathrin Hille and Patti Waldmeir

It is no secret that it is no longer that cheap to make things in China. But now, it is becoming expensive to sell there, too.

Neiman Marcus, the US multi-brand luxury retailer, plans to enter China via e-commerce rather than traditional bricks-and-mortar. And it is not the only one. A report due to be published on Friday shows that the spiraling cost of doing business in the country is driving other foreign companies with new products away from traditional retailers and into the arms of e-commerce firms. Read more

Thursday’s picks from the beyondbrics team. Chinese politics post-Bo; Chinese corruption; and China as a lonely superpower. The rationale behind Moscow’s stance on Greece and Syria; and why the next Zuckerberg might be found in Brazil. Read more

Updated with response from prime minister’s office

Two hundred and ten billion dollars. That’s the amount of money India’s Comptroller and Auditor General says was lost to the exchequer through the allocation without auction of coal mining concessions between 2004 and 2009, according to a report in the Times of India citing a leaked CAG report. Two hundred and ten billion dollars.

The figure dwarfs the $39bn of public funds the CAG said was lost in the 2G telecoms scandal that rocked the Congress Party-led government last year. Even in a country used to near-daily revelations of corruption, this time the government seems to have outdone itself. Read more

Victor Shih of Northwestern University says that the demise of Bo Xilai will serve as a warning to China’s politicians that radical change is dangerous to their careers and that there is little prospect of a change to China’s investment driven growth model.

Two bits of worrying data about China on Thursday. First, the HSBC/Markit flash purchasing managers’ index dropped to a 4-month low, with all the different sub-indexes showing contraction – pointing to more weakness in the Chinese economy.

But the more worrying slice of numbers may be trade figures coming out of Tokyo. Read more

* US under pressure over World Bank chief

* China factory activity slows, stoking market fears

* Slim’s Telmex targeted in rules regulating lease of lines Read more

Expectations that China’s redback can only rise and rise are one reason dim sum bonds – renminbi-denominated bonds issued in Hong Kong – have seen such explosive growth over the past 18 months.

The view was that with the Rmb increasing on average 4 per cent a year against the US dollar, dim sum bonds, even those offering yields as low as 1.15 per cent, looked like a good bet for return hungry investors once currency appreciation was factored in.

But with prospects for the Rmb’s appreciation no longer such a sure thing following Wen Jiabao’s speech last week in which he said the Chinese currency was close to its “equilibrium value”, what are the implications for this nascent corner of HK’s capital market? Will investors be bailing out? Read more