Morning business news - February 18Monday 18 February 2013 10.27
JAPAN ESCAPES G20 CRITICISM ON YEN WEAKNESS - Japanese shares rose this morning after finance ministers of the G20 group of nations avoided singling the country out for criticism over the recent yen weakness. The yen has dropped nearly 15% against the US dollar since November amid Japan's efforts to stoke inflation. Japan's Nikkei 225 index rose by 1.9% this morning.
Justin Urquhart Stewart, of Seven Investment Management in London, says that every major nation engages in competitive devaluation of their currencies and so it did feature high on the G20's agenda over the weekend. He says that the dramatic fall in the value of the yen is key to Japan getting its economy back on track again. But he adds that the euro will find it difficult to devalue as it has less ability to influence its future.
On the promissory note deal, the analyst says he is confident it will not unravel. Describing it as an ''imaginative and effective way'' to manage our debts, he says that he did not think the Troika would allow it to become unstuck. He says that the ECB chief Mario Draghi can report some progress in the euro zone at today's Monetary and Economic Affairs Committee in Brussels. Mr Urquhart Stewart says the ECB chief will be able to note improved confidence and the huge strides being made by Ireland in managing the country's debts.
MORNING BRIEFS - Last week Independent News and Media said it was attempting to remove the chief executive of an Australian media operation in which it has a 29% stake. Now it says it has agreed details of a deal with a South African group called Sekunjalo Independent Media Consortium for the sale of its South African business for about €170m. The disposal of the South African business will require both Independent shareholder approval and Competition Commission approval in South Africa. Independent, which is 29.9% owned by Denis O'Brien, is selling the business to pay down some of its €430m debt.
*** Workers at the loss-making Spanish flag carrier Iberia are set to begin a five-day strike today, grounding over 1,000 flights and costing the airline and struggling national economy millions of euro. Staff - including baggage handlers, pilots and air stewards - will hold three five-day strikes this month and next month to protest against management plans to cut 3,807 jobs and cut salaries at the airline. Iberia has cancelled 415 flights between Monday and Friday, although a total of around 1,200 flights operated by various airlines will be grounded because of the lack of handling services at Spanish airports. The first strike coincides with school holidays in Britain, Spain's biggest source of tourists.