Aurelia Butler

SEOUL (Reuters) – South Korea’s central bank unexpectedly left its policy interest rate unchanged on Thursday, weighing the impact of its back-to-back cuts last year while supporting the won which weakened to a 15-year low versus the U.S. dollar in recent weeks.The Bank of Korea held its benchmark interest rate at 3.00% at its monetary policy review, an outcome expected by only seven of 34 economists polled by Reuters. The remaining 27 had expected the bank to cut the rate by 25 basis points.The decision is the first since impeached President Yoon Suk Yeol’s attempt to impose martial law in early December threw Asia’s fourth-largest economy into its biggest political crisis in decades. The turmoil prompted the government to cut its 2025 economic growth forecast to 1.8% from 2.2%.The crash of Jeju Air flight 7C2216, which killed 179 people in the deadliest air disaster on South Korean soil, has also weighed on the economy.On top of that, the won’s slide has been a major concern among policymakers. In the final three months of 2024, the currency weakened 10.6% against the dollar, the biggest quarterly drop since the third quarter of 2008.Local currency dealers said South Korea has been relying on smoothing operations in the onshore dollar-won market as well as the National Pension Service’s currency hedging operations to support the won.”(Thursday’s rate decision) would be due to its (the BOK’s) greater focus on economic and financial stability concerns, until political uncertainty eases. Instead of January, we expect the BOK to cut the policy rate again at its February meeting, after it revises its economic outlook.” said Park Jeong-Woo, an analyst at Nomura Securities who was one of the seven analysts who correctly predicted the rate decision.Analysts now see the central bank eying a more gradual pace of interest rate reduction in the year ahead.Median forecasts in the survey showed one interest rate cut of 25 basis points this quarter and cuts of the same degree in both the second and third quarters taking the rate to 2.25%.Market focus now switches to Governor Rhee Chang-yong’s press conference at 0210 GMT, where the names of any dissenters to the policy decision could be announced. Dissenting votes typically lead to policy changes in subsequent months. More

Apple shipped 13.1 million units versus Huawei’s 12.9 million, the data showed. That give Apple a share of 17% and number one position, followed closely by Huawei. Total (EPA:TTEF) fourth quarter smartphone shipments from China increased 5% year-over-year to 77.4 million units.Annual shipments of smartphones in China in 2024 increased 4% year-over-year to 285 million units. More

NEW YORK (Reuters) – U.S. Treasury Secretary Janet Yellen said on Wednesday U.S. President-elect Donald Trump’s plan to set up a new government agency to collect tariffs would duplicate an existing agency and was unlikely to save money.Yellen, taping an appearance on “The Late Show with Stephen Colbert,” dismissed Trump’s plan for an “External Revenue Service,” first announced on Tuesday on his social media platform Truth Social.”If they’re looking to save money for American taxpayers, setting up a duplicative agency doesn’t seem like a good first step,” she told the U.S. television comedian.Trump on Tuesday said he would create the new agency on Jan. 20, the day he takes office, “to collect tariffs, duties, and all revenue” from foreign sources.He did not specify if the new agency would replace collections of tariffs, duties, fees and fines by the existing U.S. Customs and Border Protection, or the collection of taxes on foreign corporate and individual income by the Internal Revenue Service.It was unclear whether the move would create additional government bureaucracy, which would appear to go against the plans of Trump’s informal Department of Government Efficiency, an effort led by billionaire Elon Musk and former biotech executive Vivek Ramaswamy aimed at finding trillions of dollars in budget savings by streamlining government operations.Yellen also took aim at Trump’s repeated promises to impose new tariffs, saying they would amount to a “tax increase for the American consumer.”Trump has proposed a 10% tariff on global imports, a 25% punitive duty on imports from Canada and Mexico until they clamp down on drugs and migrants crossing borders into the U.S., and a 60% tariff on Chinese goods.Trade experts say the duties would upend trade flows, raise costs and draw retaliation against U.S. exports.Yellen said U.S. consumers would face higher costs for any imported goods and tariffs would make U.S. companies less competitive globally, while failing to address Americans’ concerns about higher prices.”What they’re going to see is the cost of making goods and services is going to go up. They’re going to be less competitive in the global economy,” she said. “So this doesn’t seem like a way to address the things that Americans have said are bothering them.” More

Labour shortages in Japan, particularly among non-manufacturers and small firms, are reaching historic levels, the government has said, stoking concerns that this supply-side constraint could stifle economic growth.Some 66% of respondents indicated that labour shortfalls were seriously or fairly seriously affecting their businesses, while 32% said the impact was not very serious.”It goes without saying this drives up personnel costs, but it could even pose a business continuity risk,” a manager at a railroad operator wrote in the survey. The number of bankruptcies caused by labour shortages in 2024 surged 32% from a year earlier to a record 342 cases, according to credit research firm Teikoku Databank. Nearly a third of respondents to the Reuters survey said the labour shortage is worsening, with only 4% reporting improvements and 56% saying the situation is neither getting better nor worse. The survey was conducted by Nikkei Research for Reuters from Dec. 24 to Jan. 10. Nikkei Research reached out to 505 companies and 235 responded on condition of anonymity. When asked about specific measures to address the labour shortfall in a question that allowed multiple answers, 69% said they were intensifying recruitment activities for new graduates and 59% were implementing such measures as extending retirement ages and re-hiring retired employees.The official retirement age is set at 60 for about two-thirds of Japanese companies, although most have introduced measures allowing employees to keep working until they turn 65, a poll by the Health Ministry showed last year. In response to a Reuters survey question about investment priorities for 2025, 69% chose capital investment and 63% selected wage hikes and other human resources-related investments. This question also allowed multiple answers.”What’s essential are wage hikes for retaining employees and capital investment for rationalising production,” an official at a chemicals company said.This trend in investment priority among Japanese firms aligns with the government’s policy of seeking economic growth through higher wages and investments. With labour shortages driving up wages and a weak yen raising import costs, 44% of Japanese companies plan to raise prices for their goods and services this year, the survey found. That compares with 17% that intend to keep their prices unchanged and 26% that plan to raise some prices but cut others.”We just cannot help but raise prices because of an across-the-board increase in wages and other fixed costs, in transportation costs and in costs of raw materials,” a manager at a metals company said in the survey. Tokyo’s core consumer price index, which excludes volatile fresh food costs, rose 2.4% in December from a year earlier. That was an acceleration from a 2.2% rise in November, keeping alive market expectations for a near-term interest rate hike. More

Maduro, whose nearly 12 years in office have been marked by deep economic and social crisis and mass migration, was sworn in for a third term on Friday, despite a six-month-long election dispute and international calls for him to stand aside.The government has employed orthodox methods to try to tamp down inflation, which has reached triple digits in recent years, with some success. Inflation was 189.8% in 2023, according to the central bank. Maduro said this month that the economy grew 9% last year. More

NEW YORK (Reuters) -Drake sued his longtime label on Wednesday, accusing Universal Music Group (AS:UMG) of defamation for promoting Kendrick Lamar’s “Not Like Us,” saying the song’s false accusation that the Canadian rapper is a pedophile has put him and his family in danger.In a complaint in Manhattan federal court, Drake said the song was “intended to convey the specific, unmistakable, and false factual allegation that Drake is a criminal pedophile” and the public should exert “vigilante justice” in response.Drake said it led to attempted break-ins at his home, prompting him to travel with extra security, and pull his seven-year-old son from his Toronto elementary school and the Toronto area.He and Lamar, an American rapper who won the 2018 Pulitzer Prize for Music, have feuded for about a decade. The lawsuit seeks compensatory and punitive damages for defamation and harassment.”UMG may spin this complaint as a rap beef gone legal, but this lawsuit is not about a war of words between artists,” according to the complaint from Drake, whose given name is Aubrey Drake Graham.”Notwithstanding a relationship spanning more than a decade, UMG intentionally sought to turn Drake into a pariah, a target for harassment, or worse,” the complaint added. “UMG chose corporate greed over the safety and well-being of its artists.”In a statement, UMG said it has not defamed anyone, called Drake’s claims untrue, and said it would be illogical to harm his reputation after investing massively to make him commercially and financially successful.UMG also accused Drake of trying to “weaponize” the legal process in seeking damages, and trying to silence Lamar’s creative expression for “having done nothing more than write a song.”Lamar is not a defendant, though Drake called “Not Like Us” defamatory. Drake’s lawyers had no additional comment.COMPETING ‘DISS’ TRACKSWednesday’s lawsuit followed a November petition in a New York state court in which Drake, through his company Frozen Moments, accused UMG and Spotify (NYSE:SPOT) of using payola and streaming bots to promote “Not Like Us” at his music’s expense.Drake withdrew that petition on Tuesday night. His related case against UMG and radio company iHeartMedia (NASDAQ:IHRT) remains pending in a Texas state court, online records show.The feud between Drake and Lamar has played out in part through so-called “diss” tracks including “Not Like Us.”In that song, released last May 4, Lamar mentioned Drake by name, saying “Drake, I hear you like ’em young” and calling him and others “certified pedophiles.”A day earlier, Drake released “Family Matters,” appearing to accuse Lamar of physical abuse and infidelity, and questioning whether Lamar’s business partner fathered one of his children.”Not Like Us” topped Billboard’s Hot 100 for two weeks last year. It received five nominations for the Feb. 2 Grammy Awards, including record of the year and song of the year.The case is Graham v UMG Recordings Inc, U.S. District Court, Southern District of New York, No. 25-00399. More

(Reuters) – A look at the day ahead in Asian markets. At last, some breathing room for investors after U.S. and UK inflation figures on Wednesday eased the vice-like grip that the soaring dollar and global bond yields had increasingly been exerting over markets.It is too early to say this marks a turning point, but fixed income and emerging markets have been beaten down so much lately that they were primed for a ‘good news’ reversal. Upbeat U.S. bank earnings and, on the margins, the ceasefire between Israel and Hamas will also help support market sentiment on Thursday.But it’s the UK and especially the U.S. inflation news that will drive markets more, and the rapid slide in bond yields and jump in stocks should pave the way for a positive day in Asia on Thursday.These numbers may not ultimately alter the Fed’s direction or even pace of rate cuts this year. But they do take the heat off policymakers and buy them more time to assess their next steps.For investors, they were instant triggers to reverse some of the bond selling that had snowballed in recent weeks and which had started to bleed into equity markets. Yields across the U.S. Treasury curve posted their biggest one-day declines since Nov. 25, and rates traders brought forward the next expected Fed rate cut to June from September.Curiously, however, the impact on the dollar was muted. It fell sharply against the yen, but barely budged against the euro. Perhaps country-specific factors are playing a greater role in setting exchange rates right now rather than solely U.S. yields and rate expectations.That may be the case in Asia, where policy and politics are spicing up local markets. Indonesia’s rupiah sank to its lowest in more than six months and the country’s stocks leaped on Wednesday after the central bank delivered a surprise rate cut. Not one of the 30 analysts polled by Reuters expected the move.The Bank of Korea delivers its latest decision on Thursday, and it could not be at a more volatile time for the country, after impeached President Yoon Suk Yeol was arrested on Wednesday and questioned for hours by investigators in relation to a criminal insurrection probe.The BoK is expected to cut its base rate by 25 basis points to 2.75%, according to 27 out of 34 economists polled by Reuters, with the remaining seven forecasting no change.Given the tense domestic political situation and in light of the cooler-than-expected U.S. inflation data, could the BoK surprise markets with a 50 bps cut to try and boost growth and loosen financial conditions? Bank Indonesia’s shock move shows that even unanimous consensus forecasts are not always the one-way bet they might seem.Here are key developments that could provide more direction to markets on Thursday:- South Korea interest rate decision- South Korea fallout from President Yoon’s arrest- Australia unemployment (December) More

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