A look at global economic developments

March 25th, 2010 Leave a comment Go to comments

The sinking euro and a downgrade of Portugal’s debt put renewed pressure on European leaders to come up with a bailout plan for Greece and stem the government debt crisis undermining their shared currency.

But agreement remained elusive as a Thursday summit approached. Markets increasingly expect any bailout for Greece to involve the International Monetary Fund — and EU governments are discussing whether they would permit that and add financial help from eurozone nations.

Germany is holding back a deal, reluctant to put taxpayer money on the line for Greece. But failure to help an indebted eurozone country would be an admission that Europe can’t halt the crisis in its currency union.

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BERLIN — Germany’s economy minister says his government remains opposed to paying financial aid to Greece.

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LONDON — The British government cut its deficit forecasts and announced a 2.5 billion pound ($3.7 billion) growth package for the economy as the centerpiece of its annual budget, its last before an anticipated tough national election.

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In Europe, the FTSE 100 index of leading British closed up 0.1 percent, Germany’s DAX rose 0.4 percent and the CAC-40 in France ended 0.1 percent lower.

Earlier in Asia, Japan’s Nikkei 225 stock average rose 0.4 percent, Hong Kong’s main index added 0.4 percent and Shanghai’s market climbed 0.1 percent. Markets in Australia and Taiwan also advanced moderately, while South Korea’s Kospi was off 0.1 percent.

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TOKYO — Japan’s parliament passed a record 92.3 trillion yen ($1 trillion) budget for the next fiscal year, seeking to underpin a fragile recovery in the world’s No. 2 economy.

Meanwhile, the country’s exports climbed sharply in February, as a solidifying global recovery fueled the world’s appetite for cars, machinery and gadgets.

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SHANGHAI — Australia and China signed a multibillion dollar energy deal, pushing ahead with business as the trial of four employees of mining giant Rio Tinto ended in Shanghai with a verdict still to be announced. Virtually all cases that go to court in China end in conviction.

The Rio Tinto case is seen by many working in China as evidence the Communist-ruled government is subjecting foreign companies to increasingly close scrutiny, raising their risks of running afoul of secrecy rules that are themselves kept secret.

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Leading credit rating agency Fitch Ratings downgraded Portugal’s debt amid growing concerns about the government’s ability to service its borrowings, another piece of bad news for the eurozone as it struggles to deal with a debt crisis.

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BEIJING — China’s commerce minister, a key defender of the country’s exchange rate policies, warned that a stronger Chinese currency have an impact on the world, not just the U.S.

Chen Deming’s comments came as the U.S. government is pushing China to allow its currency, the yuan, to rise against the dollar as a way of making Chinese exports less competitive.

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GENEVA — European regulators are investigating whether the practice of posting photos, videos and other information about people on sites such as Facebook without their consent is a breach of privacy laws.

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ADELAIDE, Australia — Internet giants Google and Yahoo have criticized Australia’s proposal for a mandatory Internet filter, calling it a heavy-handed measure that could restrict access to legal information.

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LISBON, Portugal — TAP Air Portugal pilots have called off a planned six-day strike after agreeing a pay and productivity deal with the state-owned airline’s management.

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LONDON — Britain’s Serious Fraud Office said three members of the board of French transport and infrastructure company Alstom have been arrested on suspicion of bribery and other offenses.

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FRANKFURT — German business confidence improved in March after falling in February, indicating Europe’s largest economy was emerging from the effects of this year’s harsh winter weather, a closely watched survey showed.

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HONG KONG _

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DUBLIN — Fraud detectives arrested Anglo Irish Bank’s former finance director on suspicion of aiding the cover-up of massive losses at the debt-crippled Dublin lender.

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WARSAW, Poland — Poland’s jobless rate jumped to 13 percent in February from 12.7 percent the previous month, continuing a steady rise that began with the global economic downturn.

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