The European Central Bank kept euro zone interest rates at 1.0 percent on Thursday, and markets expect it to hold them at the all-time low for much of next year to help repair the region's economy.

The decision had been seen as a near certainty. Eighty-one of 82 economists polled by Reuters before the meeting, held this month in Luxembourg, had predicted no change from the bank .

'This was entirely expected,' said UBS economist Sunil Kapadia. 'We are not expecting any more additional non-standard measures. With the data in the market improving there is no compelling reason to do more right now.'

Markets were little changed after the decision. Attention now switches to a 1230 GMT news conference with ECB President Jean-Claude Trichet. Economists think he will probably repeat that rates are appropriate at the current record low and that the bank sees faint signs of economic recovery.

[ Read the rest ... ]

jean claude trichet   ecb president   eighty one   euro zone   economic recovery   

Exelon Corp raised its hostile takeover bid for independent power producer NRG Energy Inc. by more than 12 percent to $7.45 billion on Thursday to sway investors ahead of NRG's annual meeting.

Exelon said $1.5 billion of newly identified cost savings as well as value created by NRG's recent acquisition of Reliant Energy's retail business justified the boost.

NRG common stock holders will receive 0.545 share of Exelon -- currently around $28.10 -- for each NRG share held. That amounts to nearly 8 percent above NRG's closing share price of $26.05 on Wednesday, and more than 12 percent above Exelon's previous bid, which valued the company at $25.01 at Wednesday's close.

NRG shares were up 1.7 percent, or 45 cents, to $26.50 in premarket trading.

'This is our best and final offer, and we will use the time leading up to the NRG annual meeting on July 21 to communicate the value of our new offer to NRG shareholders,' Exelon Chief Executive John Rowe said in a statement.

[ Read the rest ... ]

independent power producer   nrg energy inc   exelon corp   hostile takeover   takeover bid   

The European Central Bank left its main refinancing interest rate unchanged at a record low of 1.0 percent on Thursday, as expected by analysts.

Markets are now turning their attention to President Jean-Claude Trichet's news conference at 1230 GMT, when he will explain the decision and may fill in some of the missing details of the bank's plan to buy 60 billion euros' ($84 billion) worth of covered bonds.

The ECB also kept its overnight deposit rate, which is acting as a floor for money markets, at 0.25 percent, and left its marginal lending rate at 1.75 percent.

All but one of the 82 economists polled by Reuters had expected the ECB to leave rates on hold. One said it would cut them by 0.25 percentage points.

The ECB has lowered its interest rates from 4.25 percent since October after the financial crisis intensified and inflation risks weakened.

[ Read the rest ... ]

jean claude trichet   covered bonds   inflation risks   marginal lending   money markets   

Bangladesh's foreign exchange reserves surged to a record high of $7.47 billion at the end of June from $6.56 billion in May, the central bank said on Thursday.

It attributed the surge mostly to higher inflows of remittances from Bangladeshis working overseas despite the worst global economic meltdown since 1930s.

Bangladesh foreign exchange reserves ($ bln):

June 2009 May 2009 June 2008

7.47 6.56 6.15

($1=69.06 taka)

[ Read the rest ... ]

global economic meltdown   foreign exchange reserves   remittances   1930s   bangladesh   

Japanese Economics Minister Yoshimasa Hayashi said on Thursday he will do his utmost to prevent price falls from persisting in the economy, which is facing its second bout of deflation this decade as the output gap widens.

Weaker domestic demand helped drive a record drop in Japanese core consumer prices in May, and Hayashi said he is closely watching if delines in consumer prices will continue.

'The economy has escaped from the worst period, in a sense,' Hayashi told reporters.

'But if the output gap remains negative, price falls will continue and that will lead to a return of the kind of deflation that we had experienced in the past.'

The economics minister oversees Japan's economic conditions as well as policy and acts as a spokesman for the government's top economic advisory panel, which is headed by the prime minister.

[ Read the rest ... ]

output gap   japanese economics   japanese core   return of the kind   economics minister