Morning papers: Chinese data point to sluggish economy
The morning papers brought to you by Investment Adviser: Thursday August 9 2012.
China’s economy has made a sluggish start to the second half of the year as industrial output and retail sales both slowed in July, putting pressure on the government to step up its policy stimulus, reports the Financial Times.
Analysts said that a decline in inflation to a 30-month low of 1.8 per cent gave Beijing more room to use both fiscal and monetary tools to prop up growth.
Fears are rising that euro crisis threatens region’s biggest economies
France is heading into recession, according to its central bank, adding to fears that the eurozone debt crisis is causing the region’s strongest economies to follow their troubled southern neighbours into an economic downturn, reports The Telegraph.
The forecast came as official figures from Germany, the eurozone’s economic powerhouse, showed that its industrial production and exports both fell in June. The data raised concerns that Germany too is succumbing to the crisis and will fall back into a recession.
Standard Chartered fights back
Standard Chartered chief executive Peter Sands staged a robust defence of his bank yesterday in his first public comments on the controversy over its dealings with Iran since rushing back early from his summer holiday, reports The Independent.
Responding to accusations that the bank defied US sanctions on Iran by laundering as much as $250bn (£161bn) of Iranian money between 2001 and 2007, Mr Sands cast doubt on the integrity of New York’s State Department of Financial Services by refuting many of the facts surrounding the allegations and criticising the manner of their disclosure.
Yields on US junk-rated debt hit new lows
Demand for US junk-rated debt has propelled yields towards new lows, as investors seeking returns in a low-interest rate environment have been attracted by a record number of deals so far this month, reports the Financial Times.
The Barclays High Yield index has dropped to 6.63 per cent, just 2 basis points shy of its all-time low of 6.61 per cent set in May 2011. So far this year, high-yield bonds have returned 9.9 per cent, on pace to more than double last year’s gain of 4.2 per cent.