Oil Prices Pushed Down

February 25th 2010 proved to bring a relief for the world as oil prices were pushed down by an optimistic swing in the mood. Here is a summary of some of the major happenings of the business world on 25th February 2010:

Retreat in oil prices

An ease in oil price pressures occurred after the prices reached their two year record high on Thursday. The sharp gains were observed because of the rising unrest in Libya however high optimism about crude producers’ ability to counteract any deficiency in supply caused by Libya led to a decline in the prices.

After almost crossing the $120 mark, Brent crude was brought back to $112.65 per barrel whereas US crude was traded at $97.49 per barrel, a visible decrease from the $100 that it had reached on Thursday.

It was reported that statements made by Saudi Arabia and International Energy Agency (IEA) helped trigger the optimistic mood.

High food & fuel costs slow down deflation in Japan

Japanese deflation saw a deceleration as food and fuel costs rose in January. Consumer prices fell at a yearly rate of 0.6% if the fuel and food costs were excluded. Deflation continues to be a problem since the Japanese economy is still in its early stages of recovery.

Richard Jerram of Macquarie Group said that “The headline numbers are being distorted by commodity prices,"

"The underlying trend is not particularly encouraging...In general it shows deflation is moderating, but not going away."

Quite a few analysts believe that Japan’s central bank, the Bank of Japan, will not change its monetary policy anytime soon. According to the expectations, the interest rates will remain on a hold.

According to a forecast made by the Bank of Japan, the economy is expected to pick up pace later on in 2011 which will help in ending the present and long lasting deflation period.

Chinese telecom equipment maker welcomes formal investigation by US

After a US security panel rejected the takeover bid of American computer company 3Leaf systems by Chinese telecom company Huawei, the company said that it is open to a formal investigation by US authorities in an open letter on its website.

Concerns over the company’s military links have originated for the reason that its founder Ren Zhengfei is an ex-Chinese army office.

The company has denied having any ties with the Chinese government and military.

"Over the past 10 years, as we have been investing in the US, we have encountered a number of misperceptions" said the company in its letter.

Huawei bought 3Leaf for $2m in May 2010 however a review by the Committee of Foreign Investment in the USA said that the deal should not proceed.

Korea puts an $887,000 fine on Deutsche Bank

One of the largest fines by Korea’s stock exchange, KRX, was levied on Deutsche Bank for manipulation in the country’s stock market.

South Korean regulators have claimed that the staff of the bank plotted to force down the value of the stock index in order to profit illegally from it.

Deutsche Bank was banned by Financial Services Commission (FSC) from trading certain derivatives and securities. 

The bank stated that it was “disappointed” with the findings of the FSC.