» The IMF released a pessimistic update on the world economy. It expects global GDP to increase by 3.5% this year, the slowest pace since 2009. The estimate for growth in Britain was slashed to just 0.2% (behind France on 0.3%) and growth rates were clipped for some big emerging markets, hitherto seen as a bulwark against a global slowdown. The IMF warned that things could get worse if America did not divert course from the looming "fiscal cliff" of tax rises and spending cuts designed to kick in at the end of 2012. It also called for a "robust and complete monetary union" in the euro zone. See article»
Impeding growth
» India's government told Barack Obama to mind his own business, after the American president urged it to do more to lift curbs on foreign investment. The country's commerce minister later conceded that India could lower some barriers, such as letting foreign airlines take a stake of up to 49% in domestic carriers. Foreign investment in India fell by 38% in April and May compared with the same two months in 2011, to $3.2 billion.
» A Senate committee lambasted HSBC for ignoring warnings that money suspected of belonging to Mexican drug cartels was being laundered through its bank in the United States. Concluding a year-long inquiry, the committee's report also slammed HSBC for "disregarding" suspicions about a Saudi bank's link to al-Qaeda in its dealings with it. HSBC has not been charged with any wrongdoing. See article»
» The LIBOR scandal continued to reverberate. Sir Mervyn King, the governor of the Bank of England, faced tough questions from a committee in Parliament about what and when he knew about the manipulation of the benchmark inter-bank lending rate by bankers at Barclays. See article»
Harpooning the London Whale
» America's banks trotted out their earnings for the second quarter. Bank of America swung to a profit of $2.5 billion from the $8.8 billion loss it reported a year ago, thanks to cost-cutting and more weeding-out of bad loans. BofA's share price has risen by 40% since the start of the year, although underlying earnings remain weak. Citigroup's profit fell by 12%, to $2.9 billion. And Goldman Sachs saw both revenue and profit drop by around 10%; some have criticised the bank for continuing to pay big bonuses despite its sluggish performance.
» Credit Suisse announced a plan to raise an extra $15.6 billion in capital following a very public row with Switzerland's central bank about whether it was adequately capitalised. The slanging match had unnerved investors. See article»
» America's Consumer Financial Protection Bureau, which was set up under the Dodd-Frank reforms, imposed its first enforcement action when it ordered Capital One, a credit-card issuer, to refund $140m to 2m customers because of deceptive marketing practices. It will also pay a fine.
» Human Genome Sciences, a biotechnology firm based in Maryland, succumbed to a sweetened takeover offer of $3.6 billion from GlaxoSmithKline, a British drugs company. GSK markets HGS's Benlysta, the first new approved drug for lupus autoimmune diseases in 57 years.
» The board of Yahoo! appointed Marissa Mayer as chief executive, surprising those who assumed that Ross Levinsohn would keep the position he had held on an interim basis since the abrupt resignation of Scott Thompson in May. Ms Mayer used to work at Google, where she oversaw its search, Gmail and mapping businesses. Yahoo!'s quarterly earnings underlined the task Ms Mayer faces in turning the struggling company around: net profit was down by 4% compared with the same period a year earlier, to $227m. See article»
Point and click
» The European Union's competition commissioner opened an investigation into whether Microsoft is complying with its commitment to offer a choice of internet browsers other than its own Internet Explorer on new PCs. Microsoft reached an antitrust agreement with the EU in 2009 to present consumers with a range of browsers, which is said to have boosted the use of rival browsers in Europe, such as Google's Chrome and Mozilla's Firefox. But the newer versions of Microsoft's Windows operating system may not explicitly offer the choice. See article»
» Meanwhile, Microsoft previewed its forthcoming Office applications. The latest suite of Office tools has been designed with people on the move, using tablets and cloud computing, in mind.
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