Bad timing

24 March 2011 last updated at 14: 42 GMT Nigel Cassidy business correspondent, BBC News, Brussels was the start of the Summit of protests against expenditure cuts in Europe it was not to be be welcomed as follows.

Thursday and Friday were the economic control in the financially troubled euro area increase the days are signed as European Heads of State and Government finally new rules.

Most of the plans are now despite months of arguments and Fudges on the conditions at the design stage. You expect only debate on dinner today evening and final signature.

But once again outside events seemingly impossible, the immediate objective to capture have made it: a measure to restore peace and renewed confidence to the single currency and case rollback plan save for all future financially wayward members.

The summiteers had the gauntlet of thousands of protest against trade unionists angry on current and future cost-cutting measures its members imposed is run.

But that is just the beginning of it. Nothing, what the 17 here in the next 24 hours seems to agree, pressure ease on the bond market, now that the Portuguese Government in crisis and Ireland is likely threatens, to which the bondholders take a haircut on their loans make.

'Not to unsustainable'

Once again, diplomats are here to manage expectations.

We are constantly reminded of the Corps of darting Summit, the bag carriers in the Council building, the 17 to save Portugal if officially request support cottages can offer it.

Portuguese Prime Minister José Sócrates entered this week, but will be still the Summit

Even the head of the centre-right repeated social democratic opposition party, Pedro Passos Coelho, his "hope" that one can be avoided.

The financial markets tell a different story. Record borrowing debt prices of around 8% on the Portuguese Government are simply not to unsustainable, with large bond auctions in the the next few months.

Something has to give.

Investor confidence

All together, Brussels has to reassure the markets, that the measure to atop rubber-stamped to try future Bail-Outs to finance and control possibilities are peripheral high euro output.

But quickly undermine trust these latest events with Portugal. This is because the reason gave the Portuguese Prime Minister his resignation was that his Parliament to make savings vote would not.

It served the bond markets, because remember that Portugal (and possibly other euro countries) may not be willing or able, to commit welfare and public spending cuts on the scale required heavyweights led by Germany by euro.

All this adds only the potential future exposure for the other euro members, such as Portugal, to keep the Republic of Ireland and Greece of water.

Sources here were this afternoon to say that Portugal to help ask on the Summit was unlikely, although it could not entirely be ruled out.

It will be interesting to see, when the heads of State and Government can possibly come with something new on their press conference this evening the calm provide, still looking for Europe's lenders.

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Global food prices hit record

3 March 2011 last updated at 16: 30 GMT food markets are "already precarious", the UN says global food prices hit record highs have, and even could further increase according to the United Nations.

The UN food price index increased 2.2% in February to its highest level since the beginning of the monitoring prices in 1990, the UN food and Agriculture Organization (FAO).

He warned also that tips in might make worse oil price "already precarious" situation in the food market.

Apart from sugar, the FAO said all commodity groups in the price rise.

Oil prices hit highs due to political unrest in North Africa and the Middle East before recently two - and a half years.

The FAO said that have added to the volatility on the oil markets to an already difficult and precarious situation.

"This adds to start even more uncertainty with regard to the price Outlook as well as planting crops in some of the most important growing regions," said the FAO David Hallam.

The International Monetary Fund (IMF) said he "was concerned about the situation".

IMF spokesman pointed out that "effects on the poorest and weakest, for all in the countries with low income, but not only there" Caroline Atkinson.

The prices of cereals, wheat, rice and maize, have risen in the last year to 70%.

This is both significant crop producers on droughts in Eastern Europe and floods in Australia.

The FAO said that it expected world cereal production to a total decreased in the last year.

In addition, it is also forecast increased demand for agricultural products for food, feed and fuel production.

These contradictory pressures could push higher prices.

However, the FAO said there were positive signs, the agricultural areas in Russia, which had droughts and forest fires Ukraine and Kazakhstan to the recovery of the last year.

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Q & A: Irish Finance explained

29 November 2009, at 16: 28 GMT last updated further read the main story of the Republic of Ireland and the EU in 85bn help euro rescue package to tackle a huge hole in the public finances agreed.

As part of the package, the Irish Government has a savings program detailing four years tax increases and expenditure cuts produced.

How? the country into this mess

Celebrated as the "Celtic Tiger" for the fast growth of the economy, in the space of three years, that the Irish Republic of boom, bust of almost.

Much of the growth has been built to the real estate market. But, since 2008, this has a dramatic collapse, with house values fall suffered by 50-60%.

Bad debt have almost the country's banks, forcing the Government, she destroyed bail-out.

This opened a huge hole in the Irish Government finances - which see to this year run a budget deficit 32% of GDP.

Without taking into account the cost of rescuing the banks, the Government spending gap is considerable (and unsustainable) 12% of GDP.

A deep and painful recession caused a drastic deterioration in tax revenues and an increase in the unemployment insurance claims.

What's more, there are fears that the Government again has it cost-cutting measures in the recession, which could plunge it started, from climbing.

Insisting not the Irish Government had been that it needed bailouts for?

Yes, Dublin said until November 18, it was fully financed its spending without go to the markets, at least the middle of next year, which means revealed it to borrow more money.

You do this by issuing more bonds are IOUs investors effectively.

Many countries, the Irish Republic has seen, such as higher unemployment and lower tax revenues so why the Irish Republic issues for a Bail-Out?

The Government gave the Irish banks 2008 guarantee a ceiling at the height of the financial crisis.

But this Dublin on the hook for all the banks debts, the it value several times are the annual production of the Irish economy as a whole.

Losses at the banks mounted, ability to meet the guarantee so that she withdrew more money from the banks started foreign investors on the question of the Irish Government.

This left banks heavily dependent on the European Central Bank for the financing of emergency - something that the Central Bank and other European governments very uncomfortable made.

In addition, many are of the banks of Kreditgeber-, the guarantee pleasure - the big banks in other European countries, United Kingdom.

So it was down eventually, the other European Governments that accept Ireland a Bail-Out.

Already 10 billion euros for the Bail-Out cash his State is located in the capital reserve backed banks, with another 25 billion in reserve, for their use are provided.

The remaining 50 billion budget deal financing.

Where comes from the 85bn euro?

The money comes from:

the Irish Republic itself is 17.5bn euros to the entire Fund from its cash reserves and controversial, the national pension reserve Fund22. 5bn euro by the International Monetary Fund (IMF) one similar amount from the European Union European financial stability Mechanism17. Affirms the European financial stability contribute, which financed by eurozone Governmentsbilateral loans from United Kingdom, Sweden and Denmark.What are the possible consequences for the United Kingdom?

The United Kingdom has offered to a direct bilateral loans, the Irish Republic. The total contribution is expected to more than EUR 8 billion.

First, the United Kingdom is a direct loan for the banks euro contribute an estimated winter storm.

The rest comes from his contributions to the IMF and the European Union financial stability mechanism.

Chancellor George Osborne, said: "It is in Britain's national interest." "It is money we expect back fully preserved, and we think it helps to get Ireland back to a fully stable path to growth."

Less demand for UK would difficult times in the Irish Republic were and services of one of the largest trading partner of Britain's mean.

UK Government according to exceed trade with the country total UK trade with Brazil, Russia, India and China.

In addition, many UK banks have large exposures to the Irish economy.

The United Kingdom and the Republic are important trading partners what makes Dublin to sort your finances?

The Irish Government had already announced austerity measures and tax amounting to EUR 15 billion increase since the financial crisis of 2008.

On top of that, the latest strict four-year plan be reduced another 15 billion euros over four years.

These subscription orders include the euro in 2011 alone.

The Government had on its budget deficit 3% of GDP currently to have until 2014, by 12%. As part of the EU, Bail-Out have to reach them now to the year 2015 to this.

The Government also plans more shares in the banks, increased their capital - the buffer against future losses - to buy from 8% to 12% of their assets.

Is plan the implementation actually to get?

Junior coalition partner were to demands from its elections keep the Taoiseach, Brian Cowen, in January, after the budget is passed by 2011. But there are fears that the Government does not even last that long can.

All the Republic parties support the cuts in principle, but opposition parties do not agree on the details of where the axe should fall.

Why is the situation in the Irish Republic a concern abroad?

Other financially weaker members of the euro area such as Spain and Portugal are concerned about the risk of financial contagion.

Ireland have pushed into the arms of the IMF, panicky investors lose trust in their public finances.

Yields of Spanish and Portuguese long-term debt - a measure of how much the market would demand their governments borrow money - are trading close to of their highest levels since joining the euro area in the year 1999.

Such as Ireland Portugal has stretched public finances and a weak Government strongly.

The Spanish Government is in a better position. But its economy experienced a housing boom and bust almost as bad as Ireland, and there is great concern about the health of some of its banks.

You will take the Republic a EU Bail-Out in the hope that take it some of the heat from them is welcome.

But so far has not happened.

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US homebuilding slump in February

16 March 2011, last updated at 13: 35 GMT it was the second lowest level of the construction starts records more than 50 years ago began a month crashed 22.5% in February compared to earlier construction of new houses in the United States, new data shows.

Builders began work on new homes at a seasonally adjusted annualized rate of 479,000 in the month.

It is recorded in the depth of the last recession the second lowest level since records began more than 50 years ago just above the 477,000 in April 2009.

It was also well below the expected number of total 560,000 housing starts.

The figure was 20.8% compared to February 2010, according to the data from the US Commerce Department.

"Good News"

Influenced by the decline in activity, with in the Northeast and the Midwest with the brunt of any region.

Part of the drop was of January due to an upward revision to total 618,000 from previous estimate of 596,000.

The number of new building permits granted in February hit a record low 20.5% compared to the previous year from, or 3.3% compared to January on a seasonally adjusted basis.

"Good news for housing, begins this low level", said Bill McBride of risk calculated business blogs.

He thinks the housing market biggest problem of the large overhang of repossessed and other unsold real estate - a problem which would be aggravated by new construction only.

"I expect starts remain too low until more of excess stocks of existing real estate."

Demand for houses in the United States remains heavily printed not mortgages, with many would-be buyers found.

In the last few months, applications for mortgages have to buy properties back in the direction of the lows seen last summer - shortly after the end of a tax credit for homebuyers - according to data from the mortgage bankers' Association please.

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EU has been China tiles obligations

17 March 2011 last updated at 19: 20 GMT profit margins for tile producers were under pressure, the EU said ceramic tile prices will increase in Europe after the European Union (EU) said it would introduce heavy customs duties on imports from China set.

In an effort to what it says is illegal dumping put an end to the EU said it would impose duties of up to 73%.

China exported tiles in the value of EUR 275 million ($385 m; £ 239 m) in Europe per year, according to the EU.

EU industry "Suffers damage due to the impact of the dumped imports", the EU said in a statement.

European ceramic tiles industry is the world's largest after China.

Companies that operate in the European Union have squeezed their profit margins due to a price undercutting their prices Chinese producers in accordance with the European ceramic tile manufacturers' Federation seen.

First, the duties will continue for six months, but she could be extended to five years.

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UK inflation climbs to 4.4 %

22 March 2011 last updated at 14: 22 GMT Watch: Darren Morgan of the ONS says fuel prices helped inflation HigherThe UK consumer prices index (CPI) push annual inflation rate by 4.4%, up from 4% in January rose.

This was the cost of higher food, fuel and clothes, and was the highest level for more than two years.

Retail increased prices index (RPI) - with interest mortgage payments - inflation to 5.5% from 5.1% in January, the highest rate for 20 years.

The CPI measure was the target of 2% for 15 months with at least one percentage point over.

The overall growth of 4.4% of the CPI was more than forecast by economists had.

The CPI figure is the highest since October 2008 and will be pressure on the Bank of England, interest rates, put an end to areas lift accelerating inflation.

The expectation of higher interest rates pushed the pound to its highest level against the dollar in more than a year.

It rose the Euro 0.5% to $1.639. across it rose by 0.6% to 1,154 euros.

Contributing factors

Continue reading the most important story

the steady rise in inflation compounds the misery of the default priority savings to pensioners to supplement their income "

end quote Sylvia Waycot, money facts by the Office of national statistics, the largest inflationary pressures came from clothing and footwear costs", which 3.6% after the January sales rose.

Total increases transport costs 0.8% between January and February - increased prices by a 1.4% increase of the pump, according to the price of crude oil.

Other factors increasing domestic heating costs and on financial services rising costs and the increased costs of books and toys.

However alcohol prices fell a 1.1% - record monthly fall. Spirits fell by 5.8%.

Inflation target

"Inflation put even more pressure on his commitment to the interest rates hit your inflation target paths point to its highest since October 2008 the Bank of England, sprang has", said analyst Hetal Mehta of Daiwa capital markets.

"And inflation to around 5% will reinforce undoubtedly as feed by in the coming months, higher commodity prices this pressure."

Continue reading the most important story

today's batch of public finances and inflation numbers remind you that the unusual combination of low growth and more objective inflation are bad news for the Chancellor "

end quote Stephanie Flanders Economics Editor, BBC News, but suggested they", that an increase in interest rates would bring inflation under control.

"If interest rates start to increase by 25 basis points [0.25%] each quarter from August, in line with our expectations, we believe that inflation will average 2% next year,", she added.

For its part called the British Chambers of Commerce (BCC) of the Bank of England to remain cautious.

"The MPC must be careful before you take action that a tough cost-cutting measures, can threaten the fragile recovery, especially in the light of the plan", said David Kern, Chief Economist BCC.

"It is likely that the MPC, its credibility to restore and so we can expect interest rates to be raised in the next few months."

"However, we call for the Committee to carefully move, and avoid an economic setback early measures." He added "can cause".

Public borrowing

In the meantime, the ONS also announced that public borrowing was £ 11 billion, a record for the month of February in the last month.

The official number was almost double the £ 6 billion of the economists predicted.

The increase of public expenditure can mean that Chancellor George Osborne has less space for additional expenditure, delivering the budget on Wednesday.

"Today batch of public finances and inflation numbers remind you that the unusual combination of low growth and more objective inflation are bad news for the Chancellor", economics editor Stephanie Flanders said the BBC.

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G7 takes to support the Japanese yen

18 March 2011 last updated at 17: 28 GMT have read the most important story continue to try to stabilize the yen carried out the world's richest countries coordinated action on the foreign exchange markets.

It is the first time since 2000 that G7 countries have jointly intervened in the currency markets.

The yen weakened after the intervention, before recent trade 80.94 against the US dollar.

Earlier this week met the yen 76.25, add their strongest since World War II, with fears about Japan's recovery.

The nuclear crisis in Japan, financial markets around the world, coming soon after a great earthquake and tsunami has devastated the coast, with many concerned about the impact on the global economy taken.

The action began in Japan with the Central Bank selling to try Yen to weaken their value.

It followed the later similar measures by the Bank of England, the European Central Bank, the US Federal Reserve and the Bank of Canada.

Market reaction

The coordinated action was agreed by the G7 Finance Ministers at a Conference.

Had news of the decision direct impact how won the Nikkei 225 index to close 2.7% on Friday at 9,206.75 points.

Continue reading is the main story

in a globalized trading culture against the market are trying hard to maintain. "

End quote Hugh Pym economy chief correspondent, BBC News U.S. shares by 1% to 11,889, while stocks in Europe also for intervention responding."

Britain's FTSE 100 index rose by 0.4% to 5,718 and indexes were both above the benchmark of German and French.

"Exchange rates have as we have long said, excessive volatility and disorderly developments impact on economic and financial stability," said the g-7 in their Declaration.

"We monitor exchange markets closely and, where appropriate, to work together."

Meanwhile, the Bank injected an extra 3tn to support yen ($37bn; £ 23) in the markets to ensure confidence and liquidity on Friday of Japan.

"Slow things down"

The intervention of the G7 Nations is coming to market volatility in the aftermath of the earthquake.

A strong currency can recovery hurt prospects of some of the largest companies of Japan

Japanese Nikkei lost 225 main index more than 16% on the first two days of the week before the recovery on Wednesday.

But as well as the stocks recovered were, the yen hit send the record again in a tumble.

Japan is the world's third largest economy and relies heavily on exports. A rise in the yen make Japanese less desirable in foreign products.

Nissan has work on at least one factories newly launched its four car Assembly, but others are still fighting. Automaker Toyota has stopped operations at the 12 main assembly sites in Japan.

Each lose Honda Nissan and rival to 2 billion yen in profit per day with the planned shutdown.

Fared little better for manufacturers of consumer electronics.

Sony opened a factory that makes optical films used in liquid TV screens and adhesives. Seven other plants that make everything from Blu-ray discs to lithium batteries, remain closed.

"Slow things down"

Continue reading the most important story

it is totally different than in the previous year [when] people about currency were talking about wars and competitive devaluation "

Masafumi Yamamoto Barclays Capital quote at the end of the nuclear and earthquakes cause a"major slowdown"in the airline industry crisis in Japan", according to the international air transport association.

It said Airlines begins not again until at least the last six months of the year.

Analysts say that is likely to calm nerves G7 decision if no drastic effect on the yen value of owning it.

The intervention marks a turnaround of the situation last year when the there was much talk of countries are trying to boost sagging economic growth to their currencies.

"It is completely different than in the past year," said Masafumi Yamamoto, chief Forex strategist at Barclays Capital in Japan.

"People were talking wars and competitive devaluation of the currency." In this sense, it was very important that speculative Yen appreciation can be attacked by coordinated action. "

The G7 countries are the United States, Japan, Germany, France, United Kingdom, Italy and Canada.

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