The sectors of production and services in Taiwan are recovering

The manufacturing sector and the service sector in the Republic of China showed signs of recovery in May this year. These are the results of the latest survey of the Institute for Economic Research in the country.

The previous month was registered a growth in the manufacturing sector by 0.13 percentage points, while in services it equals 0.22 percentage points. Unfortunately not the same situation in the construction field. For the same period the country saw traffic slide by 3.4 percentage points.

Mr Sung, the director of the Center for Macroeconomic Forecasting at Taiwan Institute of Economic Research, said that while exports have declined by 3.83% in May this year, production of the country is growing at a good pace during the first five months of 2015.

"Another encouraging factor for improving the economic situation in the country and the fall in unemployment to 3.62%," said Sung. "Low energy costs and slightly higher consumer prices also show that there is a real danger of deflation." 

According to him the double-digit growth in imports of auto parts, machinery and raw materials will ensure growth and investment, while it will increase revenues from services. It is also expected the world economy to continue to stabilize.

There are forecasts for improving conditions in the country and abroad in areas as banking, food service, chemical industry and production of home appliances and bicycles.

"Not so optimistic is the forecast for the perspectives in construction sector and securities for the coming six months," said Sung.

The German concern BASF will join the "North Stream-2"

The gas pipeline "Nord Stream-2" will be put into operation at the end of 2019, reported "Interfax".

The head of "Gazprom" Alexei Miller announced the decision on a meeting of the shareholders and expressed hope that the German concern will also be involved in the project.

He recalled that "Gazprom", E.On, Shell and OMV have agreed recently to build two new lines of "Nord Stream".

"We expect that soon the German company BASF to join the project," said Miller. This is the largest chemical company in the world, including more than 160 subsidiaries.

The pipeline "Nord Stream-2" will be power 55 billion cubic meters per year.

Russia extended bans on Western food imports

Vladimir Putin signed a decree today for extension for another year of defendant sanctions of Russia against the countries that have introduced sanctions against Russia because of Crimea and Ukraine.

The Russian president said that the government has turned to him with a request to continue the measures taken in response to such actions by some countries.

The extension is for one year and is considered by August 6 and not immediately, as it was announced earlier today.

On August 6 will end the effect of the previous decree that introduced the countermeasures.

On August 1, 2014 the EU introduced sanctions against Russia because of events in Ukraine and the annexation of the Crimea and afterwards they were repeatedly extended and expanded. The last decision in this direction was taken on 22 June. In response to these sanctions Moscow introduced countermeasures last year. They were imposed in August 2014 for a year against the US, EU, Canada, Australia and Norway and concern the import prohibition in Russia by those countries of fruit, vegetables, dairy and meat products.

Russian Ministry of Agriculture announced earlier today that will enhance the control in order to prevent the Russian market from products that come from European countries that supported sanctions against Moscow.

"In any case we will not allow products from countries that have imposed sanctions on Russia, to fall one way or another, through secret compartments, black schemes or labels of third countries on the territory of Russia," said Tkachev – the Minister of agriculture.

Russian authorities have announced several times that EU goods are entering the country with labels of countries which are not EU members, such as Albania, Macedonia and Montenegro.

On Monday, EU leaders voted continuation of sanctions against Moscow to January 2016!

Business activity in the euro area registered its fastest growth in four years

Business activity in the private sector of the euro area registered its fastest growth in four years this month, according to the data from the Purchasing managers index (PMI), quoted by Reuters. The survey results provide solid evidence that the economic recovery in the region stabilizes.

The good data for the entire currency union is supplemented by individual PMI indices for the two largest economies in the region - Germany and France. Companies in the service sector and manufacturing in both countries reported higher than expected growth. These data are particularly reassuring against the instability in the financial markets due to the disagreement between Greece and its creditors. 

PMI index drawn up by surveys among thousands of companies in the region has grown to 54.1 points in June from 53.6 the previous month. So the index reached its highest level since May 2011. "This is a decent rise in terms of business activity, demand and jobs. The data show economic growth of 0.4% in the second quarter," said Chris Williamson, chief economist for Markit, who prepared the survey. The index remains above the level of 50 points that separates contraction from growth for a second full year.

To meet the increased demand, firms continued to hire more staff. However, the employment sub-index fell slightly to 51.9 points compared to the four-year high of 52.3 reached in May. PMI index of the services sector, which is fundamental in the economy of the euro area, increased from 53.8 to 54.4 points, which surpasses all preliminary estimates. The indicator of the production sector also rose from 52.2 to 52.5 points, which is the highest level of more than one year.

While firms continued to lower their prices in June, although it was the third month in which ECB’s program applies to print money and stimulate inflation. Sub-index of producer prices fell by 49 percentage points compared to 49.3 the previous month. In April the eurozone emerged from a period of deflation, and in May consumer prices rose by 0.3% due to the weak euro. Williamson warns that core inflation, which excludes goods with volatile prices such as fresh food and fuel remains very weak.

Samsung presents "Safety truck" - revolutionary technology for road safety

Last week Samsung presented an innovative concept that could potentially make driving safer than ever.
Semi-trailers are very dangerous. It’s very stressing for any driver when trying to pass them.

“Safety truck” makes it easier for drivers to see the road ahead.
How it works: a wireless camera is attached to the front side of  a trailer-truck and four giant screens on the back side display its front view to cars behind it.

This revolutionary technology may reduce the traffic accidents and is also intended to prevent sudden brakes or crashes into animals on the road.

“Safety truck” is still a prototype but already has been successfully tested and this fact confirmed that this innovative technology works and definitely will save lives!

This video will give you a better idea of how it woks!

Read more here.

The fate of Greece and the EUR will be decided today

Greece's creditors received new proposals from the Greek government for reforms just hours before today's emergency summit of eurozone leaders.

"The new Greek proposal - received ... This is a good basis for progress at the summit," wrote on Twitter Zelmayr Martin, Chief of Cabinet of the President of the European Commission, Jean-Claude Juncker.

Greece submitted new proposals last night. 

Today, Greek Prime Minister Alexis Tsipras will meet with European Commission President, President of the European Central Bank Mario Draghi, the managing director of the International Monetary Fund Christine Lagarde and President of the Eurogroup Jeroen Deyselblum.

Afterwards will be held an extraordinary meeting of eurozone finance ministers, on which  they will discuss technical details of the Greek proposal.

And tonight begins a summit in Brussels, at which leaders of the eurozone will discuss the rescue of Greece.

"The fate of Greece and the euro to a great extent will be decided today", commented the  European Commissioner for Economic Affairs Pierre Moscovici. According to him, the outcome of the summit will be to prevent the bankruptcy of Greece.

Meanwhile, the French finance minister Michel Sapin welcomed the "good work" of the Greek government and the new proposals for reform.

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Russia is preparing for the bankruptcy of Greece

Central Bank of Russia is discussing an action plan in case of Greece’s exit from the eurozone, said today the governor of the institution Elvira Nabiullina.

According to her Greece's exit from the eurozone implies risks for the Russian economy since the monetary union is Russia’s biggest trading partner.

Meanwhile Greek Prime Minister Alexis Tsipras will meet with Russian President Vladimir Putin this Friday (19.06.2015) at the World Economic Forum that will take place in St.Peterburg.

Tsipras has repeatedly criticized the EU and USA sanctions against the Kremlin imposed because of the Russian interference in Ukraine.

Officially on meeting with Putin Tsipras will discuss the extending of the Russian credit lines for Greek government and will be discussed plans to continue the route of the gas pipeline "Turkish flow" after Turkey's border.

IPO date for Fitbit is coming very soon

The manufacturer of the popular Fitbit fitness bracelets could become a public company with an initial public offering on the New York Stock Exchange on 18 June, according to official information provided from NASDAQ.

Although making this step, the company faces a great challenge by a competitor in connection with patent issues and other problems.

In the last two weeks of the competitors of Fitbit - Jawbone - threatened the company with two lawsuits claiming patent infringement in so-called wearable technology.

According to market research company IDC Fitbit is a leader in business wireless-enabled wearable devices that measure data such as the numbers of steps walked, quality of sleep and other personal metrics, while Jawbone is in fifth place.

According to the registration of the company that was made earlier this month, Fitbit plans to release 22.4 million shares in a price range of 14-16 dollars per share, which would bring her 358 million dollars.

The company expects the current shareholders to sell nearly 7.5 million shares in addition to issued by Fitbit.

Fitbit has proved to be a profitable company, having increased more than double its revenue - from 271.1 million dollars in 2013 to 745.5 million in 2014, taking into account a profit of 131.8 million dollars last year.

The company’s trading symbol will be “FIT”.

Emergency plan for Greece

The European Union has decided to impose "emergency plan" to save Greece from bankruptcy if the country by the end of this week does not reach agreement with creditors, reports Süddeutsche Zeitung.

Greeks will receive funding under conditions similar to those for Cyprus during the financial crisis in 2013. I.e.  the country will have to give up entirely of financial independence.

Control will be inputted  on capital movements and restructuring of the financial system will be imposed.

If negotiations reach a deadlock, the plan foresees from next week Greek banks to remain closed for several days in order to be prepared for the control of the transactions.

It is possible the amounts that can be withdrawn from ATMs to be limited, as well as the size of electronic payments.

Yesterday was placed a record in amounts withdrawan from Greek banks. Only for а single day were closed deposits for 600 million euros. Comparing to Friday the withdrawn amounts were 2.5 times more.

The new week started with a drop for the US indices

US indices are traded by around 1% down at the beginning of the session on Monday after drop in European shares which  came as a result of the continuing problem with the negotiations between Greece and its creditors.

Athens and its creditors failed to reach a deal over the weekend after European officials accused Greece for failure to meet commitments for reforms in return for the final tranche of the necessary financial support. Last week, the International Monetary Fund announced that there are "major differences" between the two negotiating teams, who met in Brussels.

Beyond developments in the negotiations for Greece's debt, the key event of the week is the two-day meeting of the Federal Open Market Committee, which begins on Tuesday and ends on Wednesday with a statement of Janet Yellen.

Yields on US 10-year bond dropped to 2.31 %, while that of 2-year bonds - less than 0.70%.

Industrial production in the US unexpectedly fell in May to 0.2% against the expectations for growth of 0.3 %.

The US dollar rose against most major world currencies, one euro traded above 1.12 dollars.

Hungary against Serbia

Hungary is ready to consider all options to reduce the flow of immigrants entering the country from Serbia,  said on Friday the Prime Minister Viktor Orban.

According to Orban "these people must remain in Serbia".

In this connection, the Hungarian Government intends to consider all options for a solution. One of them is the construction of a wall on the border with Serbia.

Orban said that in its current form migration represents "danger" for the country.

The Prime Minister is convinced that the EU must change its approach to consider applications of immigrants wishing to settle in Europe.

Orban believes that Brussels should build a special infrastructure on the problem to be outside the EU. This will allow applications to be considered abroad and arrived in Europe only approved applicants for asylum.

Domestic demand proved surprising support for economic growth in Turkey

Turkish economy grew more than expected in the first quarter of 2015 thanks to strong domestic demand.

Gross domestic product (GDP) expanded by 2.3% in January-March compared to 2.6% reported in the fourth quarter of 2014, according to latest data of the Turkish Statistics.

Household consumption, which accounts for about 2/3 of Turkey's GDP increased by 4.5% in 2.4% reported in the previous quarter.

Central Bank of Turkey suppressed consumption when in January last year increased interest rates. Then domestic demand rose only 1.3%.

The surprising stimulus that GDP obtained from strong demand  may distract expectations for a loosening of the monetary policy against the background of the unknowns after the parliamentary elections on 7 June, said the analyst in London Capital Group Ipek Yozkardeskaya.

"This is good news for the pound as better-than-expected data favor tightening of monetary policy," said the analyst. "The need for higher interest rates may increase in parallel with the political nervousness."

Following the publication of data the Turkish lira rose by 0.8% with traded to 2.7332 against the dollar.

Greece is trading off bonds for 2.925 billion Euros

Facing bankruptcy Greece managed to raise 2.925 billion Euros from the sale of six-month and three-month bonds.

Almost  1,625 billion Euros were raised from trade off 6-month bonds at 2.97%. The remaining 1.3 billion Euros come from the quarterly bonds at 2.7 interest.

However, on June 19, Athens must pay another  1.6 billion Euros at maturity date of the emission of three-month bonds.

In an official statement the Greek Government states that Athens is still awaiting an official response from the international creditors concerning the recent proposals from the country to achieve a breakthrough in negotiations and recent agreement on the type of "money for reforms."

On Tuesday "Wall Street Journal" reported that the European Commission rejected the Greek reform proposals against which to obtain financing.

According to the latest report of Eurostat Bulgaria is among the countries with the highest growth on a quarterly basis in the EU

In the first quarter of 2015 Bulgaria is among the countries with the highest economic growth in the EU on a quarterly basis - 0.9 percent against 0.4 percent in the previous three months, according to Eurostat.

Among the members of EU for which there is available data for the first quarter of 2015, the fastest growing economy on a quarterly basis is Czech Republic (3.1%), followed by Cyprus and Romania (both 1.6%) . Reductions in GDP were recorded in Lithuania (-0.6%), Estonia (-0.3%), Greece (-0.2%) and Finland (-0.1%).

The latest report from Eurostat confirmed that the eurozone economy has accelerated its recovery in the first three months of the year. The data reported 5-year high of rising of the gross domestic product (GDP) amid occurring at the same time contraction in the US and a recession in Japan.

The aggregate GDP of the 19 members rose by 0.4% on a quarterly basis in January-March after a 0.3% rise seen in the last three months of last year. Final data coincided with both the interim evaluation, and with analysts' forecasts.

This is the best result since the first quarter of 2011 onwards when he had a growth of 0.8%.

On an annual basis the economy of EU expanded by 1% in the reporting period compared with growth of 0.9% observed in the fourth quarter of 2014. And here the final data coincided with both the interim evaluation, and with forecasts of experts.

For the first time since the first quarter of 2010 the four largest economies in the euro area reported growth. In addition, for the first time since the first quarter of 2011 the economy of EU rose more quickly than USA and UK .

The news came at a particularly favourable time as European economies continue to benefit from the many supporting factors at once. Oil prices remain relatively low, global growth is stable and the euro continues to depreciate.

A look towards the monetary policy is showing now that quantitative easing from the European Central Bank (ECB) now have a significant impact on financial markets, which contribute to lower interest rates and expectations for improving credit conditions.

In the latest economic forecast European Commission revised up its forecast for growth of EU and explained that predicts the economy will grow by 1.5% in 2015, 0.2 percentage points above the previous estimate. For Bulgaria the Commission expects economic growth of 1%. In the fall of 2014, Brussels predicted that the Bulgarian economy will expand by 0.6 percent this year.

In April the Ministry of Finance (MoF) has revised upwards its forecast for economic growth in 2015 and now expects growth of 1.4% in the initial 0.8%. Last year, gross domestic product (GDP) expanded by 1.7% - the fastest growth in two years.

Sharp drop in Chinese imports

China's exports  has moderately decreased in May,the imports collapsed sharply and that led to an increase in the trade surplus to 59.49 billion USD compared to 34.1 billion in April.

For the first five months of the year  the surplus reached 217.26 billion, but the continuing weakness in imports gives a reason to analysts to predict that the surplus for 2015 could approach $ 600 billion compared to $ 383 billion for the previous 12 months.

In May  exports fell by 2.5% yoy, recovering from a sharp fall from 6.4 percent in April. But the trend remains negative for the third consecutive month.

At the same time  imports accelerated decline of 16.2% to 17.6% yoy, reflecting the anemic domestic consumption.

For the period January-May  export has grown with 0.7% compared to the same period in 2014, while  the import has decreased 17.3%.

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South Korea indicate boost in economy growth

The growth of the fourth largest economy in Asia - South Korea, reached 2.5% in the first quarter of 2015 compared to the same period last year, reports the BBC.

The pace of increase exceeded the forecasts of South Korean Central bank. The bankers had expected growth of 2.4%. The government report also showed that the rise in gross domestic product (GDP) reached 0.8% in January-March compared to the last quarter of 2014.

The growth has been supported by the construction and investments as well as the consumption and production sector. Analysts predicted a slight growth in the first quarter. South Korea's economy is expected to gain momentum later in the year. In the last quarter of 2014 the economy of South Korea marked the lowest growth rate in the last six years, expanding by only 0.4%.To promote economic growth, South Korean Central bank reduced the interest rate to 1.75% in March. This move surprised the markets, but analysts expressed the opinion that it is possible prolapse of the new rate to the historic low of 1.5% in the coming months.

Russia's oil output at record high in May

Russia's oil output reached a record in May according to the preliminary data reported by the Energy’s Ministry CDU-TEK unit.The oil production has reached 10.708 million barrels per day, following by the competitor  Saudi Arabia with  10.25 million barrels. The third place is for USA.

According to James Henderson, analyst of oil markets from Oxford University, Russian oil output has proved to be too resistant to the fall in prices and for Russia it will not be difficult to maintain production at a high level in the next year or two.

The fact is that after the implementation of the international sanctions against the Kremlin for Russian participation in crisis in Ukraine and the annexation of the Crimea Peninsula, oil production in Russia is growing. In 2014 the country was third in oil production in the world.

Intel will acquire Altera for $16.7 Billion

Intel is closer to concluding a deal to acquire the competitive processors developer Altera, reported Financial times. According to sources of the newspaper the suggested price is $ 54 per share, that valuated the company at over 16.7 billion Dollars. This represents a 15% premium to the share price of Altera, before the media announce information about the deal.

The deal, which could be announced officially this week, will be the biggest in the history of Intel and will be the next consolidation in the series of mergers and acquisitions in the sector of computer chips.

The previous biggest deal was the acquisition of Intel developer of antivirus software McAfee for 7.7 billion Dollars in 2011.

The consolidation between producers of semiconductors is happening against the background of downward pressure on prices coming from the major producers of smartphones such as Apple and Samsung. The merger should give them more confidence in negotiations with bigger customers and allow them expansion amid slowing growth in demand for processors.

Altera has over 3000 employees in 19 countries and this could help Intel to diversify production and become less dependent on the sector of personal computers. Merging can also lead to filling of excess production capacity in the plants of Intel.

Altera's chips are used mainly in equipment for telecom, wireless and network devices, but also for military hardware, automotive and other industries. Altera programmable processors are increasingly used in processing centers and data can be customized for features such as faster execution of specific functions such as Internet search. Huawei and Ericsson are among the biggest customers of Altera.

Money flowing out of Greek banks

Deposits in Greek banks fell by 4.9 billion Euros only in April, reaching its lowest level in more than 10 years, according to the Bank of Greece.

The total volume of savings has shrunk to 133.7 billion Euro, which is a record low since September 2004. Deposits in Greek banks decreased for the seventh consecutive month.

Since the end of November last year to April this year Greeks withdrew 30.6 billion Euros from their accounts. According to the Central Bank the daily outflow from the banksis  between 100 and 500 million Euros.

This reduction in liquidity in the banking sector makes it entirely dependent on funds from the European Central Bank via the mechanism of emergency liquidity assistance / ELA /. 

Last week, the ECB raised the margin of money in ELA to 80.2 bln Euros.