Starbucks to hike prices on ‘labor intensive’ drinks

29 09 2010

NEW YORK (CNNMoney.com) — Starbucks drinks, long considered symbols of Americans’ penchant to overspend, are about to get even pricier.

The coffee giant said late Wednesday that it will raise the price of “labor-intensive and larger-sized” beverages because of soaring prices of green arabica coffee beans.

Starbucks (SBUX, Fortune 500) said green coffee prices are close to a 13-year high, and costs for its other raw ingredients, including dairy, sugar and cocoa, have been volatile.

As CNNMoney reported earlier this month, coffee futures have climbed more than 40% since June.

“[This has] completely altered the economic and financial picture of many players in the coffee industry,” Starbucks chief executive Howard Schultz said in a written statement. “We have thus far chosen to absorb the price increases ourselves and not pass them on to our customers. But the extreme nature of the cost increases has made it untenable for us to continue to do so.”

Continue Reading: http://money.cnn.com/2010/09/22/news/companies/starbucks_prices/?section=money_latest





Public money ‘being misspent’ says global BBC poll

29 09 2010

A BBC survey in 22 countries says that people believe that governments misspend more than half of the money they receive in taxes.

But many people also want their government to play a more active role in the economy, the survey suggests.

This survey of more than 22,000 people in rich and developing countries has a bleak message for governments.

The figures vary from nation to nation, but the general picture is that people do not feel their taxes are well spent.

In Colombia and Pakistan, the average estimate of the amount of tax not spent in the public interest was more than two-thirds.

In no country was it less than one-third. Spain, at 34%, was the only one that came close to that.

Continue Reading: http://www.bbc.co.uk/news/business-11417470





Irish credit rating is downgraded

26 08 2010

The Irish Republic has had its credit rating downgraded by a leading ratings agency, Standard and Poor’s (S&P).

S&P fears that the growing cost of propping up the country’s troubled banking sector will further weaken the government’s finances.

It now thinks that the Irish government will spend 90bn euros ($101bn; £74bn) helping the banks, 10bn euros higher than previous estimates.

The country’s own debt agency described the analysis as “flawed”.

It claimed that S&P’s outlook was based on an “extreme and unrealistic” scenario of the cost of recapitalising the banks and questioned its calculations.

S&P cut the rating one step to from AA to AA-, its lowest since 1995.

This follows clearance earlier this month for an additional injection of 10bn euros into Anglo Irish Bank.

The agency now forecasts that net government debt – the sum of all borrowing – will rise to 113% of GDP in 2010. That would be a substantial increase on the 64% level recorded in 2009.

Continue Reading: http://www.bbc.co.uk/news/business-11081069





Pakistan seeks IMF loan restructuring after floods‎

25 08 2010

Officials from Pakistan are holding talks with the International Monetary Fund to discuss its $11bn loan package in the wake of the devastating floods.

The IMF’s regional director, Masood Ahmed, told the BBC the organisation wanted to find a way to help Pakistan “through this difficult phase”.

This could include lowering some fiscal targets or allowing Pakistan to apply for emergency natural disaster funding.

Earlier, UN officials described the humanitarian situation as critical.

They said that although the UN had raised 70% of the $460m (£295m) needed for emergency relief, many people had yet to receive any help. In the UK, relief agencies say public donors have now given £29m ($45m).

Government officials and aid agencies in the southern province of Sindh said 80% of those affected had fled their homes.

The Indus river outside the city of Hyderabad is at its highest for more than 50 years and is expected to rise further on Tuesday.

Prime Minister Yousuf Raza Gilani is expected to hold high level talks on Tuesday on Pakistan’s medical needs, amid growing concern of a public health disaster.

Doctors have been overwhelmed by the need in some areas – skin rashes and dehydration are common, many children have diarrhoea and there is concern about the spread of cholera.

Continue Reading: http://www.bbc.co.uk/news/world-south-asia-11060119





IMF set to approve Sri Lanka loan payment

25 08 2010

The International Monetary Fund (IMF) has indicated it will release the next tranche of a multi-billion dollar loan to Sri Lanka.

Following a two week mission to the country, the body gave an upbeat assessment of Sri Lanka’s economy.

It said government targets for deficit reduction were on track, with taxes increasing and spending being cut.

An IMF mission also arrived in Serbia on Monday to assess its economy with a view to releasing a loan payment.

The body agreed a 3bn euro ($3.8bn; £2.4bn) loan with the country last March.
‘Strong growth’

The IMF approved a $2.6bn (£1.7bn) loan to help Sri Lanka weather the global economic crisis last summer.

The Sri Lankan government also said it would use the money to pay for post-war reconstruction following the end of fighting with the Tamil Tiger rebels.

Continue Reading: http://www.bbc.co.uk/news/business-11064346





Iceland cuts interest rates to 7%

18 08 2010

Iceland’s central bank has cut its key interest rate to 7% from 8%.

A rate cut had been predicted after inflation eased and the country’s currency strengthened, although the reduction was larger than expected.

Iceland’s interest rate hit a peak of 18% in October 2008 when the country’s banking system was thrown into crisis by the global credit crunch.

The crisis led to the country’s largest banks being taken over by the government.

In late 2008, the International Monetary Fund approved a $2.1bn (£1.4bn) loan for Iceland, making the country the first Western European nation to get an IMF loan since 1976.





Bank of England member votes again for rate rise

18 08 2010

A member of the Bank of England’s Monetary Policy Committee (MPC) has voted again for a rise in interest rates.

Minutes from the MPC’s August meeting show Andrew Sentance voted to raise the Bank rate to 0.75% from the record low of 0.5%, citing high inflation.

It is the third month in a row that Mr Sentance has called for a rate rise.

The other MPC members at the meeting all voted for rates to be held at 0.5% for the 17th month in a row.

They also voted not to pump any more money into the economy under the programme known as quantitative easing (QE), but said they were ready to do so should conditions require it.

The Bank has already pumped £200bn into the economy under QE to help stimulate demand.

The MPC also said that financial markets had improved since its last meeting, thanks largely to the European-wide bank stress tests, which increased confidence in the banking sector.

But it added that lending conditions look set to remain tighter for longer than it had previously forecast.

Continue Reading: http://www.bbc.co.uk/news/business-11009844








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