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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Chispas who wrote (27660)	4/16/2005 11:57:54 PM
From: mishedlo	Read Replies (1) \| Respond to of 116555

Japanese minister says no need for free trade pact with Australia Friday, April 15, 2005 7:09:04 AM TOKYO (AFX) - Japan's agriculture minister said there is no need for Tokyo to launch talks for a free trade agreement (FTA) with Australia, which hopes to strike just such a deal when Prime Minister John Howard visits next week Yoshinobu Shimamura, the minister of agriculture, forestry and fisheries, told a news conference that he was satisfied with the current economic situation between the two countries "At this moment, I see no need for (FTA) negotiations," Shimamura said, adding: "Australia's average tariff rates are already low and its investment climate is good." The issue of a bilateral trade pact is one of the key topics likely to be discussed when Howard meets Japanese Prime Minister Junichiro Koizumi on Wednesday. Howard will arrive on Tuesday for a three-day visit Last month, Australian Foreign Minister Alexander Downer visited Japan and pressed Tokyo for a trade deal, saying he hoped to see a bilateral feasibility study on an Australia-Japan FTA finalized soon Since 1967, Japan has been Australia's biggest export market, with Japan buying 2.1 trln yen worth of goods ranging from beef to natural gas last year, according to the Japanese finance ministry Australia is Japan's fourth largest source of imports, at 1.28 trln yen forexstreet.com

To: Chispas who wrote (27660)	4/16/2005 11:59:11 PM
From: mishedlo	Respond to of 116555

Aust dlr falls below 77 US cents as commodity prices drop Friday, April 15, 2005 7:09:43 AM aap.com.au Aust dlr falls below 77 US cents as commodity prices drop SYDNEY, April 15 AAP - The Australian dollar opened weaker today, weighed down by a continued fall in commodity prices. At 0700 AEST the local unit was trading at $US0.7698/06 compared with $US0.7730/31 at yesterday's close. During overnight trade, the local unit reached a high of $US0.7754 and a low of 0.7695. This comes despite it reaching a high of $US0.7805 on Wednesday night. National Australia Bank head of research Peter Jolly said the Australian dollar had continued to decline in line with commodity prices. ´It's is trickling off here now, the slide of base metals has continued which has been the main weight on the Aussie,´ he said. During the overnight London session bench-mark metal copper fell to an eight-week low, aluminium ended 1.3 per cent down and zinc fell 3.5 per cent, after touching its lowest level since January 18. Also offshore, the US bond market overnight had cut back its expectations of US Federal interest rate rises, Mr Jolly said. ´There was a buy US dollar story, despite the fact that people are pulling back Fed expectations.´ Earlier in the session, the US currency held steady after US weekly jobless claims showed labor market conditions broadly as expected. First-time jobless claims fell for the second straight week to 330,000 in the latest week. The US government will issue the Treasury International Capital (TIC) report for February on tonight, which will show the size of portfolio flows into the US and its ability to finance its current account deficit, said Mr Jolly. ´This is pretty important, because (the Australian dollar) has moved significantly on the TIC data before,´ Mr Jolly said. He said the Australian dollar could struggle to remain above 77 US cents in the short term. ´It was only about a week ago that we were down around $US0.7630/40, and that is still better characterised as the range,´ he said. ´It couldn't go down through $US0.7630 and it couldn't go above 78 so that is what we think at the moment.´

To: Chispas who wrote (27660)	4/17/2005 12:05:35 AM
From: mishedlo	Read Replies (3) \| Respond to of 116555

Upcoming inflation data could be ugly Friday, April 15, 2005 10:08:36 PM afxpress.com WASHINGTON (AFX) - The squeamish should avert their eyes. The coming week's inflation data could be very ugly The Labor Department will release both the consumer price index and the producer price index in the coming week. Both numbers should show large increases in prices due to higher oil prices But core measures - which strip out food and energy prices - should be more moderate The producer price index will be released Tuesday at 8:30 a.m. The survey calls for the PPI to rise 0.7% and the core to rise 0.3% The CPI is the main event for the week. The scheduled release is Wednesday at 8:30 a.m. Eastern. Economists surveyed by MarketWatch expect the CPI rose 0.5% in March, with the core rate up a tame 0.2%. It would be the largest increase in the CPI since October, when a similar spike in energy prices pushed the CPI up 0.6%. The CPI hasn't risen by more than 0.6% for six years and hasn't bested 0.7% for nearly 15 years Gasoline prices spiked in March. According to Energy Department data, retail gasoline pump prices averaged about $1.95 a gallon in February, but $2.12 in March, an 8.7% increase Pricing power The question for the Federal Reserve and for anyone who wants to forecast inflation and interest rates is: How much of that price increase was passed on to consumers in the form of higher prices for other goods and services? Anecdotally, there are plenty of stories of businesses passing along higher fuel prices, said Rich Yamarone, head of research at Argus Research, pointing to energy surcharges in businesses such as florists, airlines, freight companies, pizza parlors and taxi drivers. Yamarone said he wouldn't be shocked to see the CPI rise by "upwards of 1%." Now we see the value of looking at core inflation measures. It's not that the Fed doesn't realize people have to eat or buy energy; it's that core inflation measures allow us to see if higher energy prices are becoming engrained in consumer and business psychology For there's little the Fed can do about higher energy prices, except perhaps drilling for oil underneath the Eccles Building on Constitution Avenue. But if the Fed can persuade the public that it will not allow higher prices to multiply and proliferate in an endless cycle, then inflation can remain under control even if oil prices double So far, the core measures show little pass-through from energy prices. While crude goods prices in the producer price index have risen 8.1% in the past year, finished goods prices have risen 4.7% and core consumer goods prices have risen only half that at 2.3% The widening gap is "reflecting the inability of firms to pass on price increases to consumers," said Benjamin Tal, an economist at CIBC World Markets. Wages are a drag, not a push So far in this cycle, wages haven't been a factor in pushing inflation higher. In fact, just the opposite is true. Real wages are falling, which means consumers aren't able to easily cope with higher prices. If energy prices rise, consumers are more likely to cut back on other, more dispensable spending, such as gas-guzzling cars and luxuries like eating meals out "Retailers could be forced to pile on the discounts in order to lure shoppers back to their stores, like we saw last summer, helping throw cold water on core inflation's recent acceleration," said Leslie Preston, an economist at CIBC World Markets Wal-Mart, for one, has already warned that April sales could be sluggish. The Fed will weigh in on the inflation story on Wednesday afternoon at 2 p.m. with the release of the Beige Book. Last time, the Fed said retail prices were "generally flat or up modestly," but it also noted increasing reports of firms about to pass on higher prices