A look at economic developments around the globe

AP News
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Posted: Aug 31, 2011 4:32 PM
A look at economic developments around the globe

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

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LONDON _ World stock markets rallied as investors hoped that the Federal Reserve would respond to mounting signs of weakness in the global economy and provide more stimulus to the U.S. economy.

Britain's FTSE 100 ended the day up 2.4 percent, France's CAC-40 closed 3.1 percent higher and Germany's DAX rose 2.5 percent.

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TOKYO _ Earlier in Asia, Japan's benchmark Nikkei 225 logged a fifth day of gains to close narrowly up at 8,955.20 after spending part of the day in negative territory.

Hong Kong's Hang Seng jumped 1.6 percent, South Korea's Kospi gained 2 percent and Australia's S&P/ASX 200 rose 0.6 percent. Benchmarks in the Philippines, Taiwan and Singapore also rose. The benchmark Shanghai Composite Index gaining slightly.

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BRUSSELS _ Inflation in the 17 euro countries remained steady at 2.5 percent in August, adding to expectations the European Central Bank will hold off raising interest rates _ and may even consider cutting them _ as economic growth slows.

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ATHENS, Greece _ Greece is discussing with its foreign creditors how to reduce the impact of its deep recession, the country's finance minister said, stressing that the next few weeks will be crucial.

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BERLIN _ German Chancellor Angela Merkel's Cabinet approved a plan to beef up the eurozone's rescue fund, the first step toward its passage in Europe's biggest economy.

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BEIJING _ The Chinese government remains focused on reining in surging prices despite global instability and has no plans to change controls that have caused its economy to slow, says Premier Wen Jiabao.

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TOKYO _ Japan's industrial production fell short of expectations in July as a strong yen, power shortages and slowing global economy compounded the struggle to recover from the March 11 earthquake and tsunami.

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AMSTERDAM _ Experts say the Iranian government may have been behind a hacking attack, allowing it to read Google email from dissidents who thought they were using secure connections. Chicago-based Internet security firm Vasco said its Dutch subsidiary, DigiNotar, detected the hack on July 19.

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PARIS _ The French president's office says that French banks hold euro7.6 billion ($10.9 billion) in frozen Libyan assets. There is an international push to free up funds for the Libyan opposition.

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BERLIN _ The number of Germans out of work increased slightly in August amid signs that the upswing in Europe's biggest economy is cooling. The unemployment rate held steady at 7 percent.

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LISBON, Portugal _ Portugal's government plans "unprecedented" spending cuts next year to meet debt-reduction targets in return for a euro78 billion ($112.7 billion) bailout, the country's finance minister said.

Portugal has to abide by debt targets to qualify for bailout loans from its European partners and the International Monetary Fund.

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DUBLIN _ Ireland's unemployment rate rose to 14.4 percent on doubts that the bailed-out country can tame its debts and deficits.

Ireland has been trying to escape its three-year recession through export growth led by multinational companies. The domestic economy remains dormant because of weak consumer demand, high household debts and a collapsed real-estate market.

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MADRID _ Spain's prime minister said a fast-track constitutional amendment to force the government to keep its future deficits low is essential to restore confidence among investors worried the country might need a bailout.

The amendment could be approved as early as next week.

Labor unions are furious over the idea of a deficit cap and want a referendum. Regional governments are angry because the reform will severely trim their financial autonomy.

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BRUSSELS _ The European Union's competition regulators are examining whether France is providing tens of millions of euros in unfair state aid to Agence France-Presse, sparking deep concern among officials of the French news agency.

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MANILA, Philippines _ The Philippine economy slowed in the second quarter as weakness in construction and industry offset growth in consumer spending amid a lackluster global recovery.

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BERN, Switzerland _ Switzerland's government says the country's currency is still too strong despite a series of measures taken to make it less attractive to foreign investors.

The franc's traditional role as a safe haven in troubled economic times has badly hurt Switzerland's export and tourism industries.

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BELGRADE, Serbia _ An IMF delegation reached an agreement with Serbia on a standby loan of euro1 billion ($1.4 billion). It warned that Europe's financial debt crisis will hurt growth in the Balkan nation.

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COPENHAGEN, Denmark _ A report said Denmark is no longer in a recession and technically wasn't in a recession in previous quarters either.

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BEIJING _ The Philippine president urged Chinese companies to invest more in his country despite a territorial spat and pledged they would receive open and equal access.

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HELSINKI _ UPM-Kymmene plans up to 1,300 layoffs and mill closures in Finland and Europe as it streamlines operations and slashes paper production by 1.3 million tons to cut costs and combat overcapacity.

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