BI keeps SBI rate unchanged at 13.10%

BI keeps SBI rate unchanged at 13.10%

JAKARTA: The weighted average interest rate on one-month SBI promissory notes was unchanged at 13.10 percent, as expected, in a weekly auction Wednesday, the central bank said.

Bank Indonesia also said it accepted Rp 14 trillion (US$1.5 billion) of bids at the auction, or 92 percent of total bids.

Indonesia had been cutting rates this year to boost economic growth. The benchmark one-month SBI was almost 18 percent in the third quarter of last year.

But the central bank had reversed that policy bias as the rupiah came under renewed downward pressure following the Oct. 12 terrorist attack in Bali, which killed nearly 200, mostly western tourists.

Raising interest rates further, however, isn't an option for Bank Indonesia because such a move will raise the costs of bailing out banks, many of which went under during the Asian economic crisis in 1997-98, analysts say. -- Dow Jones

Aussie deficit hits 25-month high

SYDNEY: Australia reported its largest monthly trade deficit for more than two years on Monday after imports outstripped exports for the 11th consecutive month.

Australian Bureau of Statistics (ABS) figures showed the deficit on goods and services was A$948 million (US$530 million), seasonally adjusted in September, up from a revised deficit of A$831 million in August.

The deficit, the largest since August 2000, was higher than market expectations of A$600-650 million.

The ABS said exports were up 1.0 percent in September while imports rose 2.0 percent.

The figures immediately put the Australian dollar under pressure, with the currency falling from 55.55 U.S. cents to 55.45 U.S. cents shortly after the figures were announced.

Rural exports dropped by 135 million dollars, or six percent, as the impact of the country's ongoing drought's continued to worsen, while exports of non-rural goods and services fell 140 million or two per cent. -- AFP

Mexico, Aussie eye free trade pact

MEXICO CITY: Mexican President Vicente Fox discussed the possibility of a free trade pact with Australian Prime Minister John Howard at a summit here, Fox's office said in a statement Tuesday.

The summit, which took place at the Mexican presidential residence Los Pinos, followed a private visit by Howard to Mexico City on the heels of the Asia Pacific Economic Cooperation (APEC) forum in Los Cabos in northeastern Mexico.

Both leaders agreed, said the statement, that "the support of other regions, specifically countries with better economic outlook, was crucial to the development of Latin America."

Fox and Howard said they were "studying the advantages and opportunities of a free trade agreement between the two countries." No other details were released.

Mexico and Australia established relations in 1966. By 2001 Mexico became Australia's premier Latin American trading partner with US$435 million in annual trade. -- AFP

SKorea's surplus triples

SEOUL: South Korea's current account surplus tripled to US$459.7 million in September from $150.9 million in August on stronger exports and reduced services account deficit, the Bank of Korea said Wednesday.

"A slight rise in merchandise trade surplus and sharp falls in services account deficits combined to help boost the current account surplus," the central bank said.

In September 2001, the current account surplus stood at $735.8 million, it said.

The trade account surplus rose to $1.1 billion in September from $1.01 billion a month earlier, with exports rising to $13.9 billion from $13.58 billion and imports rising to $12.8 billion from $12.56 billion.

The services account, which covers travel and royalties, posted a $661 million deficit, down from a $1.03 billion deficit a month earlier, the bank said. -- AFP

Brazil suspends U.S. wheat exports

BRASILIA: The Brazilian government temporarily suspended imports of U.S. wheat, Agriculture Minister Luiz Carlos de Oliveira announced Tuesday.

De Oliveira told reporters that the suspension comes after Brazilian authorities found cirsium arvense in a shipment of U.S. wheat. The harmful grass, also known as Canada thistle, can spread easily and disrupt other crops such as soybeans.

Brazil is not equipped to deal with the grass, which is not native to South America, the minister said, noting that: "No Mercosur (a regional group that includes Argentina, Brazil, Paraguay and Uruguay) can risk contamination of their crops."

The suspension now limits Brazilian companies choice of suppliers, due to contamination found in European wheat, the minister said. On Oct. 4, 90,000 tons of Ukrainian wheat were found to have been contaminated by the fungus altinaria triticina, a leaf blight. -- AFP