A look at economic developments around the globe

AP News
Posted: Dec 16, 2009 2:13 PM

A look at economic developments and activity in major stock markets around the world Wednesday:


LONDON _ The number of Britons claiming unemployment benefits fell in November for the first time in almost two years, giving a boost to hopes that the British economy is emerging from recession.

European markets rose. The FTSE 100 index of leading British shares closed up 34.49 points, or 0.7 percent, at 5,320.26 while Germany's DAX rose 92.09 points, or 1.6 percent, to 5,903.45. The CAC-40 in France was 41.73 points, or 1.1 percent, higher at 3,875.82.


ATHENS, Greece _ Standard and Poor's Ratings Services downgraded Greece's credit rating, voicing doubts that recent measures announced by the government would curb the country's ballooning public debt.

The downgrade came after another agency, Fitch, lowered its rating on Greece's national debt last week.

Greece has been facing its worst debt crisis in decades amid the global recession. It faces political pressure from the European Union to straighten out its finances and obey deficit limits intended to support the shared euro currency.

Standard and Poor's said in a statement it was cutting Greece's rating from A- to BBB+ with a negative outlook.


OSLO _ The Norwegian central bank raised interest rates for the second time in the last three months, lifting its key rate by a quarter percentage point to 1.75 percent.

Maintaining however that it plans to keep rates low until the middle of next year, Norges Bank cited renewed economic growth, both at home and abroad, and sharper-than-expected inflation for the move.


LONDON _ Britain opened an investigation into suspected fraud by collapsed Icelandic bank Kaupthing, a move that could revive diplomatic tensions between the two countries.

The Serious Fraud Office said it is particularly interested in efforts by the bank to attract British investors to its "high yield" deposit account, Kaupthing Edge.

The SFO estimates that more than 30,000 British individuals, companies and organizations invested in the Kaupthing Edge account.


MOSCOW _ Finance Minister Alexei Kudrin said Russia's gross domestic product rose 8 percent in November month-on-month _ and is set to show 2 percent growth for the fourth quarter.


Asian stocks were mostly lower. Hong Kong's Hang Seng shed 0.9 percent to 21,611.74 and South Korea's Kospi fell 0.1 percent to 1,664.24. Australia's benchmark index lost 0.3 percent after figures showed that the economy slowed in the third quarter as the boost from government stimulus spending faded. Taiwan's market dropped 0.7 percent. China's Shanghai index slipped 0.6 percent as new share sales absorbed cash and sated buying appetite.

But Japan's Nikkei 225 stock average bucked the trend, rising 0.9 percent to 10,177.41 _ its best finish since Oct. 27.


BERLIN _ Germany's new center-right Cabinet approved a 2010 budget plan that includes record levels of new debt and higher government spending as the country seeks to safeguard its recovery from recession.

The budget puts spending at euro325.4 billion ($475 billion), a 7.3 percent increase on this year's planned outlay of euro303.3 billion. It foresees new borrowing of euro85.8 billion ($125 billion) _ about euro48 billion more than this year, and the largest figure since World War II.


DUBAI, United Arab Emirates _ Abu Dhabi's main sovereign wealth fund, which is alleging fraud over its $7.5 billion investment in Citigroup Inc., vowed to fight for its "legal rights" as it seeks compensation or an exit from the deal.

Word of the dispute emerged late Tuesday when Citi issued a brief statement saying it had been hit with an arbitration claim from the Abu Dhabi Investment Authority alleging "fraudulent misrepresentations" in connection with the two-year-old agreement.

ADIA, one of the world's biggest government wealth funds, declined to provide a copy of the claim or discuss the dispute in detail.


PRAGUE _ The Czech Republic's central bank cut its key interest rate by a quarter of a percentage point to 1 percent _ its lowest rate since the country was created in 1993 out of the former Czechoslovakia.