WHAT TO WATCH OUT FOR TODAY:
Possible Brazil interest-rate easing. Will policymakers further slash the benchmark rate to a record low as Brazil’s once-hot economy stalls, or will rising inflation concerns keep their fingers off the button?
The Beige Book read on the US economy. Look for signs in the Federal Reserve’s report of ongoing strength in housing. On the other hand, keep your eye out for signs that businesses are battening down the hatches in case the economy goes over the fiscal cliff.
Potential iPhone 5 supply disruptions. Bloomberg reports that Apple supplier Foxconn is having quality control issues due to its choice of aluminum. The Taiwanese owned, China-based manufacturer has been forced to stop production to solve problems, the newswire claims.
BAE and EADS to decide whether to pursue (paywall) their long-planned merger. The defense contractors have until 5pm GMT to get it together or break it off, unless the UK Takeover Panel gives them more time. The deal has been hampered by squabbling between European governments, some of whom are keen to play a role in the merged company to safeguard military secrets and jobs.
WHILE YOU WERE SLEEPING:
Toyota recalled 7.4 million cars because of potentially faulty electric windows. Models including Yaris, Corolla and Camry cars that were sold in the US, Europe and Asia are affected. It is reminscent of 2009-10, when the Japanese carmaker had another recall crisis, that time due to cases of unintended acceleration.
The IMF warned of growing risks to global financial stability. European policymakers’ slow progress in stabilizing the euro zone is stalling the global economy, the IMF warned in a semi-annual report released Tuesday, adding that “confidence in the global financial system has become very fragile.” The IMF cut its global growth forecast to 3.3% ahead of meetings in Tokyo later this week. It also warned that European banks may have to start a fire sale of assets, which will likely reduce credit for consumers and homebuyers.
Multinationals gave a mixed reading on the state of the global economy and China slowdown. Aluminum maker Alcoa reported stronger quarterly profits than expected, but cited “challenging market conditions,” and cut its forecast for aluminum demand growth for 2012 from 7% to 6%. The Yum Brands restaurant company raised its 2012 outlook, as quarterly sales in China increased 6%. US engine maker Cummins lowered its 2012 targets, citing increasing global economic uncertainty and weakening demand in China. Australian miner Rio Tinto warned it will likely cut jobs.
QUARTZ OBSESSION INTERLUDE:
Matt Phillips on the China slowdown: “Reading the tea leaves of Chinese monetary policy is never easy. But analysts argue that the People’s Bank of China is in the midst of a significant change in the tools it uses to tighten or loosen money.” Read more here.
MATTERS OF DEBATE:
Airlines should allow in-flight cell phone calls. Some do via satellite connections, though it’s forbidden in US airspace.
Syria and Turkey are headed toward war. It could happen even if neither country wants it.
Silicon Valley coders write bad software. And it’s because they’re bad writers.
There’s a business in financial astrology. And according to its practitioners, the Federal Reserve’s horoscope is ominous.
UK universities are tapping the bond market for funding. Amid cuts in government grants, Cambridge University considers leveraging up to attract students.
ALSO TODAY: It is Taiwan’s National Day. One British expatriate resident has collected a gigantic photo mosaic to celebrate, after making a feel-good video, called “I Love Taiwan” that became a Youtube sensation in East Asia.
Best wishes from Quartz for a productive day. Please send any news, queries, bad software code, and financial horoscopes to firstname.lastname@example.org.