IMF's global growth forecast rises
The International Monetary Fund (IMF) is raising its forecast for world economic growth this year and has predicted that inflation will also rise.
Yields on 10-year Treasury notes climbed to the highest in five years on June 12 on speculation the pace of economic growth will push up borrowing costs.

The European Central Bank, the Bank of Japan, the People's Bank of China and the Bank of England have all indicated that further rate increases may be in the pipeline this year, while economists at Merrill Lynch and Goldman Sachs now expect the US Federal Reserve to leave rates at a six-year high rather than cut them. 2007 will mark the fifth consecutive year of world growth in excess of 4 per cent — the longest streak of sustained expansion in three decades.

The IMF in April predicted global growth of 4.9 per cent this year and next after 5.4 per cent in 2006. The fund currently forecasts growth in the US, the world's largest economy, to slow to 2.2 per cent this year from 3.3 per cent in 2006 amid a slump in its housing market led by defaulting sub-prime mortgage borrowers.

The world's major central banks have increased borrowing costs over the past year to contain inflation. Policy makers are concerned that sustained global growth will fuel wage and price increases as companies operate at full capacity and unemployment drops.

China's central bank officials said the bank may raise rates for a third time this year to curb inflation and take the steam out of a surging stock market.
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Indo-Thai FTA to be signed by September
New Delhi: The Indo-Thai free trade agreement (FTA) is likely to be signed by September this year and will initially cover goods. Services and investment would be included at a later stage.

Negotiations for the FTA will re-start in July.

Thailand has agreed to start parallel talks for including goods, investment and services in the FTA.

Commerce ministry officials said after the FTA on goods becomes effective, provisions relating to investment and services will be added to it.

The FTA covering trade in goods is likely to be effective by 2010.
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Steel prices expected to fall
Kolkata: Steel prices are expected to fall by Rs500-1,000 a tonne following a stabilization of global and import prices, due to the appreciation of the rupee against the dollar.

The industry is considering whether it should increase the discounts or bring down the listed price. A final decision in this regard is expected within a couple of days.

Industry sources said, the reason for a drop is two-fold: the global prices have softened (it has stabilised now) and cheap imports are flooding the market.

Imports of hot rolled coils (HRC) are priced at around Rs 26,000 a tonne, much higher than domestic HRC prices, which are at Rs 35,000-37,000 a tonne. Sources said imports have been on the rise due to the appreciation of the rupee against the dollar.

As the percentage of consumption had increased, imports, which were at 2.1 million tonne in 2005-06, increased to 3.9 million tonne in 2006-07 and is expected to exceed four million tonne this year.
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