EUROZONE
Citi cuts growth to 0.8%
Citigroup Inc cut its economic growth forecast for the eurozone, citing pressures from a high interest rate environment as the European Central Bank (ECB) has signaled further hikes. Citi economists now see the eurozone’s real GDP growing 0.8 percent this year, down 0.3 percentage points from their previous forecast. The eurozone’s real GDP is forecast to grow 0.9 percent next year, Citi economists said in a note on Tuesday. The ECB’s deposit rate now stands at a 22-year high of 3.5 percent following a 25-basis point hike last month, and policymakers have signaled more hikes to come to tame sticky inflation.
THAILAND
Price increases easing
Consumer prices are set to rise less than previously forecast this year, the Ministry of Commerce said yesterday, after headline inflation last month fell to its lowest level since 2021 on lower energy and food costs. Overall consumer prices would gain 1 to 2 percent this year, down from 1.7 to 2.7 percent predicted previously, the ministry said. Official data showed the price index rose 0.23 percent last month from a year earlier, while the core measure, which excludes fuel and food prices, rose 1.32 percent and marked the softest reading since early last year.
REAL ESTATE
German market sinks
Germany’s market for commercial real estate plunged to the lowest level since at least 2017 in the latest sign of the turmoil triggered by soaring interest rates. Deal volumes in the first half of this year declined 50 percent from the previous six months to 14.9 billion euros (US$16.2 billion), figures provided by real-estate firm Jones Lang LaSalle Inc (JLL) showed. The figure was about two-thirds below the average over the past five years. However, there are signs the pace of the market’s contraction is slowing, with year-on-year drops getting less severe, JLL data showed.
METALS
McKinsey warns of shortages
McKinsey & Co yesterday warned that metals considered key to the clean-energy transition face shortages in coming years, potentially suppressing the adoption of electric vehicles, wind turbines and solar panels. These deficits are likely to slow global decarbonization efforts by raising supply-chain costs, McKinsey said in a report. Nickel, necessary for the lithium-ion batteries that power electric vehicles, is expected to face shortages of about 10 to 20 percent by 2030, while dysprosium, a rare-earth element commonly used in electric motors, might experience shortages of as much as 70 percent, McKinsey said. Supplies of copper, lithium, cobalt, iridium and tin also might be crimped.
TURKEY
Inflation slows to 38.2%
Annual inflation slowed to 38.2 percent last month, official data showed yesterday, although economists said that this might be a low point for the year. The rate slowed from 39.6 percent in May, the TUIK state statistics agency said. A separate study released by independent economists from the ENAG group who question the official data put last month’s figure at 108.6 percent, up from 105.2 percent in May. The official rate has been steadily dropping since reaching a more than two-decade high of 85 percent in October of last year. However, economists think inflation would soon start growing faster because of the vast spending pledges President Recep Tayyip Erdogan meted out ahead of May’s general election.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said that its investment plan in Arizona is going according to schedule, following a local media report claiming that the company is planning to break ground on its third wafer fab in the US in June. In a statement, TSMC said it does not comment on market speculation, but that its investments in Arizona are proceeding well. TSMC is investing more than US$65 billion in Arizona to build three advanced wafer fabs. The first one has started production using the 4-nanometer (nm) process, while the second one would start mass production using the
When an apartment comes up for rent in Germany’s big cities, hundreds of prospective tenants often queue down the street to view it, but the acute shortage of affordable housing is getting scant attention ahead of today’s snap general election. “Housing is one of the main problems for people, but nobody talks about it, nobody takes it seriously,” said Andreas Ibel, president of Build Europe, an association representing housing developers. Migration and the sluggish economy top the list of voters’ concerns, but analysts say housing policy fails to break through as returns on investment take time to register, making the
‘SILVER LINING’: Although the news caused TSMC to fall on the local market, an analyst said that as tariffs are not set to go into effect until April, there is still time for negotiations US President Donald Trump on Tuesday said that he would likely impose tariffs on semiconductor, automobile and pharmaceutical imports of about 25 percent, with an announcement coming as soon as April 2 in a move that would represent a dramatic widening of the US leader’s trade war. “I probably will tell you that on April 2, but it’ll be in the neighborhood of 25 percent,” Trump told reporters at his Mar-a-Lago club when asked about his plan for auto tariffs. Asked about similar levies on pharmaceutical drugs and semiconductors, the president said that “it’ll be 25 percent and higher, and it’ll
CHIP BOOM: Revenue for the semiconductor industry is set to reach US$1 trillion by 2032, opening up opportunities for the chip pacakging and testing company, it said ASE Technology Holding Co (日月光投控), the world’s largest provider of outsourced semiconductor assembly and test (OSAT) services, yesterday launched a new advanced manufacturing facility in Penang, Malaysia, aiming to meet growing demand for emerging technologies such as generative artificial intelligence (AI) applications. The US$300 million facility is a critical step in expanding ASE’s global footprint, offering an alternative for customers from the US, Europe, Japan, South Korea and China to assemble and test chips outside of Taiwan amid efforts to diversify supply chains. The plant, the company’s fifth in Malaysia, is part of a strategic expansion plan that would more than triple
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