Mindful Money’s news round-up: Thursday 4th August 2011

4th August 2011

Story of the day:

From Reuters, with financial markets in turmoil and economic growth slowing, policymakers around the world may once again be forced to cooperate to try to head off a crisis, as they did successfully in 2008-2009. But this time, they have fewer good options.

World poorly placed to meet new economic crisis

And the best of the rest:

The New York Times is discussing luxury goods, even with the economy in a funk and many Americans pulling back on spending, the rich are again buying designer clothing, luxury cars and about anything that catches their fancy.

Even Marked Up, Luxury Goods Fly Off Shelves

In the Telegraph, Lloyds Banking Group, the part-taxpayer owner bank, has fallen to a £3.25bn first-half loss after setting aside billions to compensation customers who were mis-sold payment protection insurance (PPI).

Lloyds posts £3.25bn loss after PPI mis-selling costs

Japan has followed in Switzerland's footsteps and intervened to stem the strength of its currency, which has been boosted by investors seeking safe-haven investments, reports the Guardian.

Japan drives down yen as volatile trading grips Europe

And the Financial Times is reporting success for the Bank of Japan, the yen has fallen after Tokyo intervened to weaken the currency in the latest move by a central bank to combat the impact of recent market turmoil.

Yen weakens after BoJ intervention

More woes for the eurozone from the BBC News, debt-laden Italy is likely to default, but Spain might just avoid it, according to the British think tank, the Centre for Economics and Business Research.

Italy 'to default' but Spain may 'just' escape

Also from the BBC News, mining giant Rio Tinto has reported a big jump in profits due to strong demand in Asia and charging higher prices for its products.

Rio Tinto profits jump on Asian demand

Interest rates will almost certainly be held at 0.5 per cent once again today as the Bank watched London markets tumble by a nine-month record 134 points following the U.S. economy's travails, reports This is Money.

Fragile world markets and debt fears mean record-low interest rate expected to be held

Reuters is discussing a possible merger, Hitachi Ltd (6501.T) and Mitsubishi Heavy Industries Ltd (7011.T) have begun talks to merge, three sources with knowledge of the matter told Reuters, a move that would bring much needed consolidation to corporate Japan.

Hitachi, Mitsubishi edge towards groundbreaking merger

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