Market briefing---Matt (slow)
Tokyo (slow)
>> welcome back to the “world financial report.” treasury secretary john snow was back on capitol hill today defending president bush’s proposed budget. once again, snow was quizzed by lawmakers on china’s currency policy. snow told the senate budget committee that the u.s. and chinese agreed on the need for that country to move to a more flexible exchange rate.
>> they are beginning to take steps. there’s increasing talk about moving to a partial flow or a currency basket. but i want you to know, we’re very much engaged on that issue and want to hold their feet to the fire on continuing to make forward progress there.
>> the bush administration is under pressure from some lawmakers in an election year to nudge china toward a less restrictive exchange rate policy. u.s. manufacturers clain complain the fixed rate keeps china’s exports cheaper than they otherwise would be in a free-floating currency market . low interest rates and a boost in consumer spending probably allowed indonesia to expand at the fastest pace in three years. with details on this and a look ahead for next week on the asian markets , we go to tokyo.
>> gross domestic product reports come out for three asian economies in the coming week. here in japan, the government may say wednesday the economy grew at its fastest pace in three years in the fourth quarter, contributing to a global expansion. economists surveyed by bloomberg say the world’s second-biggest economy expanded at a 4.6% pace. investments by sharp and cannon are helping to boost sales. still, economists say the yen’s 12% rise against the dollar in the past year may curb exporter sales, slowing economic growth in 2004. in taiwan, g.d.p. numbers are out on monday. the government recently raised its growth forecast for all of 2003 to 3.2%. rising exports are helping to revive the island’s economy. sales and profits of electronics makers such as acer and elan microelectronics are climbing as spending and economic growth picks up in china, the u.s., and europe. the benchmark index gained 42% in the past six months and the jobless rate is at a two-year low. on monday, indonesia may say its economy expanded at its fastest pace in three years in the final quarter of 2003, consumers snapped up clothes and motorcycles. economists surveyed by bloomberg say southeast asia’s economy probably grew 4.5% from a year earlier. the lowest interest rates in more than five years are stoking consumer spending which makes up 70% of the economy. that’s helping the economy overcome a slump in international investment caused by a terrorist bombing in bali in 2002. on their earnings front, quantas airways comes out with first-half numbers on thursday. merrill lynch expects the airline to earn more in the year ending june, in the following financial year, because of a faster-than-expected recovery in international ticket sales. australia’s biggest air carrier is setting up a discount airline unit to compete with an expanding virgin blue. quantas and other airlines are recovering from the sars outbreak and a war in iraq that has hurt travel in 2003. the australian dollar’s 32% rise against the u.s. dollar in the past year is working against quantas. the stronger low currency lowers the airline’s competitiveness in terms of relative advantage to other
