South Korea Central Bank Cuts Interest Rate to Boost Growth

Lee Ju-yeol, Bank of Korea governorReuters

South Korea's central bank has cut its benchmark interest rate for the first since May 2013, supporting the government's measures to boost economic growth.

The Bank of Korea (BOK) said it lowered the seven-day repurchase rate to 2.25% from 2.5%.

The decision, predicted by most economists, has been welcomed by the country's finance ministry, saying it would add synergy to the government's strategy to boost growth.

BOK governor Lee Ju-yeol noted that the central bank's decision was aimed at reviving sentiment, which was hurt by the April Sewol ferry accident. Lee added that lowering the policy rate by 25 basis points could lift growth by 0.05-0.10 percentage points.

"The committee judges that improvements in domestic demand, which had contracted due mainly to the impacts of the Sewol ferry accident, have been insufficient, and that the consumption and investment sentiments of economic agents also continue to show sluggishness," the central bank said in a statement.

The BOK added that it will "closely monitor external risk factors such as shifts in major countries' monetary policies, changes in economic agents' sentiment and movements of future economic indicators including the household debt trend, while observing the effects of this month's base rate cut and the government's economic policies."

Following the decision, the central bank would adopt a wait-and-see approach going forward, as the rate is expected to have some side effects, according to economists.

"Governor Lee remains vigilant to the side effect of rate cut which will likely increase household debts. We think that the BOK will maintain the policy rate at 2.25% in September because the central bank would need to assess the impact of today's action," said Louis Lam, economist at ANZ Bank.

"We view that the possibility for another cut in the following meeting becomes low unless the overall sentiment deteriorates further."

Lam added that the central bank may explore other forms of monetary easing including some targeted loan programmes to accommodate the stimulus package announced earlier by the government.

Following the country's weak economic growth for the second quarter, the government announced a stimulus package to lift growth. The stimulus will include expanding fiscal spending by 11.7tn won ($11.4bn, £6.7bn, €8.5bn) and an extra 29tn in policy financing.

In addition, the BOK is expected to revise its inflation target, which is currently 2.5-3.5%.

Gaza Strip Crisis: Israel and Hamas Ceasefire Extended by Five Days

Israeli soldiers return from the Hamas-controlled Palestinian coastal enclave(AFP)

The Israeli government and Palestinian militants have agreed to extend the ceasefire in Gaza by another five days.

The news came just minutes before a three day truce was due to expire.

Head of the Palestinian delegation in Cairo, Azzam al-Ahmed, confirmed the news, telling AFP news agency: "We have agreed to give more time for the negotiations."

The ceasefire, which began on Sunday night (10 August) comes despite Israeli claims that three rockets were fired into the country two hours before the truce was due to end at 10pm UK time.

“We have agreed to give more time for the negotiations.”

- Azzam al-Ahmed, Head of Palestinian Delegation in Cairo

While Hamas militants have denied any responsibility for firing the rockets, Israel has retaliated by launching air strikes on Gaza, just as an agreement had been reached on extending the truce.

It is not yet clear whether the latest strikes will be upheld as a major breach of the ceasefire.

Officials from both sides have been holding indirect talks in the Egyptian capital. It's hoped that the extension of the truce, will allow peace talks to continue in search of a long-term resolution to the month-long Gaza conflict.

The delegation head, Azzam al Ahmad, said he hoped a final deal would be reached in the coming weeks, with Arab and international backing.

He said the ceasefire was meant to ensure a "positive atmosphere", while noting there had been "lots of progress" in the talks.

Mr al Ahmad added that Israel had conceded some ground, but not on the crucial point of ending the blockade of Gaza.

The Palestinian delegation has now left Cairo to consult with leader Mahmoud Abbas.

More than 10,000 homes have been destroyed in Gaza since July 8 and more than 1,950 Palestinians have been killed in five weeks of fighting in Gaza, most of them civilians.

67 people are reported dead on the Israeli side. All but two are military personnel.

David Cameron: Britain Will "Play a Role" in Rescuing Yazidis from Sinjar Mountains

Prime Minster David Cameron has pledged Britain will help to rescue displaced Yazidis from rape, kidnap and execution(Reuters)

Prime Minister David Cameron has announced that Britain will "play a role" in rescuing the tens of thousands of stranded Yazidi people trapped by Islamic State (IS) militants on Mount Sinjar in northern Iraq.

Speaking after chairing a meeting of the Cobra emegerncy committee on the crisis, he revealed "detailed plans" were currently being put in place to create an operation that will help free members of the religious sect from persecution, slavery, rape and death.

UK RAF helicopters have already made three rounds of aid drops of food and water to help the thousands of Yazidis fleeing IS militants.

RAF Tornado jets are also preparing to carry out surveillance operations to support aid deliveries to the region, and a cargo plane loaded with water containers and filtration units has flown out of East Midlands airport.

Members of the Kurdish Red Cresent help a woman in a wheelchair near the Syrian border town of Elierbeh(Reuters)

Cameron returned from a holiday for the meeting. He said: "We need a plan to get these people off that mountain and get them to a place of safety, and I can confirm that detailed plans are now being put in place and are under way, and that Britain will play a role in delivering that."

The prime minister would not say whether the Chinooks deployed by Britain to the mountains would also be used to airlift refugees to safety.

When asked whether he would recall Parliament from its summer recess in the wake of the crisis, he answered: "This is a humanitarian operation that Britain is involved in, so I do not think it's necessary to recall Parliament for that."

The UN has warned that tens of thousands of civilians are trapped on mountains in northern Iraq near the Syrian border by fighters from IS.

An estimated 40,000 people have escaped from the mountains into Syria and on to the Kurdistan region of Iraq in the past three days, with the UN warning they needed "life-saving assistance".

Reports have emerged that conditions are so bad, men and women are said to be killing their families and then themselves. One man murdered his five sisters before killing himself, a Yazidi man told witnesses in the Kurdish city of Dohuk.

It is also understood that some terrified Yazidi women have thrown themselves to their deaths from Mount Sinjar to avoid being kidnapped, raped and sold into sex slavery by the jihadist militants.

Fidel Castro's 88th Birthday: The Life and Career of the Former Cuban Leader in Pictures

Fidel Castro, the former Cuban dictator, turns 88 on 13 August 2014. He served as the island's prime minister from 1959 to 1976, and then as president from 1976, until ill health forced him to hand over power to his brother Raul in 2008.

Together with Ernesto "Che" Guevara and a guerrilla force, Castro fought against the regime of General Batista, ousting him 31 December 1958.

July 1953: Fidel Castro gives a statement after being arrested for a failed attack on the Moncada Barracks in Santiago de Cuba. He was sentenced to 15 years imprisonment, but released the following year.(AFP)

Portrait of Castro in 1955, during an interview in New York.(AFP)

Castro with soldiers of the Rebel Army en route for Havana in 1959. He became prime minister in February of that year.(Getty)

21 April 1959: Castro shakes hands with American vice-president Richard Nixon during a press reception in Washington DC.(Getty)

1960: US writer Ernest Hemingway awards three trophies to Castro after a fishing contest in Cuba.(AFP)

1961: Members of Castro's militia pose in the Escambry Mountain area of Cuba, during the ill-fated US-backed Bay of Pigs invasion.(Getty)

May 1963: The now-president Castro and Soviet leader Nikita Khrushchev pose during an official visit to Moscow.(AFP)

5 July 1968: Castro shows a photograph in which General Ovando Candia and other members of the Bolivian Army celebrate the murder of Che Guevara.(Getty)

28 May 1972: Castro relaxes in a swimming pool during a visit to Romania.(Reuters)

September 1973: Castro examines a rifle during a visit to North Vietnam during the Vietnam War.(AFP)

4 September 1986: Castro jokes with his counterparts Libyan leader Muammar Gaddafi and Nicaraguan president Daniel Ortega during the non-aligned countries summit, in Harare, Zimbabwe.(AFP)

8 January 1989: A white dove lands on Castro's shoulder as he delivers a speech at a ceremony to commemorate the 30th anniversary of the Cuban Revolution in Havana.(AFP)

10 May 1994: Castro gets a quick photographic lesson from photographers, before South African President Nelson Mandela's inauguration at the Union Buildings in Pretoria.(AFP)

13 December 1994: Castro greets retired Venezuelan military officer Hugo Chavez upon his arrival at Jose Marti Airport in Havana.(AFP)

22 October 1995: Castro and US President Bill Clinton look at each other as world leaders take their places for a group photo in the United Nations building in New York.(AFP)

23 October 1995: Castro waves a boxing glove in the air, during an appearance at a restaurant in the Bronx, New York.(AFP)

1 December 1995: Fidel Castro tours the Great Wall of China during his nine-day Chinese official visit.(AFP)

17 October 1996: Castro, flanked by his Salvadoran president Armando Calderon Sol and Colombian president Andres Pastrana, participates in an induction ceremony by the Port Wine Fraternity for the 19 heads of state at the eighth Ibero American summit at the Bolsa Palace in Porto, Portugal.(AFP)

2 September 1998: South African President Nelson Mandela greets Castro as he arrives for the opening of the 12th Non-Aligned Movement summit in Durban.(AFP)

18 November 1999: Honorary coach Fidel Castro smiles after a friendly game between veterans from Cuba and Venezuela. Cuba won 5-4. Castro admitted that Cuba's victory came about by a trick he played on his rivals. In the final innings of the game, several professional Cuban baseball players took to the field disguised with moustaches, beards and wigs, pretending to be old men.(AFP)

14 May 2002: Former US president Jimmy Carter and Castro listen to the Cuban national anthem at the baseball stadium in Havana(Reuters)

1 May 2005: Castro listens to a speaker during the May Day parade in Havana's Revolution Square.(Reuters)

13 August 2006: Venezuelan president Hugo Chavez visits his ailing Cuban counterpart Castro at his bedside in Havana.(Reuters)

13 August 2006: Castro appears in one of the first photos taken after three failed operations for intestinal problems.(AFP)

28 September 2010: Castro delivers a speech in Havana. His brother Raul took over as president on February 24, 2008.(AFP)

In an undated photograph released on 11 July 2014, Cuba's former president Fidel Castro talks with Russia's President Vladimir Putin during a meeting in Havana.(Reuters)

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Tata Steel's Profit Drops 70% on Provisions and Higher Taxes

Tata Steel's profit drops 70% on provisions and higher taxes.Reuters

Tata Steel, the largest Indian producer of steel, reported a huge drop in its first-quarter consolidated net profit, hit by provisions for impairment of non-core assets and higher taxes.

Group net income, including that of subsidiary Tata Steel Europe, dropped 70% to 3.37bn rupees ($55m, £33m, €41m) in the April-June first-quarter, as against 11.39 billion rupees a year ago, the Mumbai-based firm said in a statement.

Net sales jumped 11% to 361.43bn rupees, buoyed by an increase in European demand.

Tata Steel's stock finished 1.33% lower at 534.70 rupees (£5.2) in Mumbai while the benchmark S&P BSE Sensex share average finished 0.15% higher.

Tata Steel's shares have risen some 26% this year.

T V Narendran, Managing Director of Tata Steel India and South East Asia, said in the statement: "The economic sentiment has improved in India after the general elections and the new government has been clearly communicating its intentions to bring the economy back to the growth path. Government's thrust on development of core industries like housing and infrastructure should boost steel demand in the coming quarters...In South East Asia, we are focussing on improving our product offering, expanding our customer reach and optimising costs to improve the performance."

Karl-Ulrich Kohler, MD & CEO of Tata Steel in Europe, said: "European steel demand is moving in the right direction. Though demand remains well below levels we would regard as healthy, we can see greater stability emerging in the markets we serve. Our quarterly financial performance improved slightly, despite market spreads tightening compared to the previous year. This would not have happened without the work we are doing to reduce costs and improve our products and services. We maintained the good pace set last year in our portfolio enhancement programme. We have launched ten new products and increased the proportion of differentiated sales by almost 20%."

Entire South Korean Space Programme Shuts Down as Sole Astronaut Quits

Yi So-yeon became the first Korean in space in 2008(Getty)

The entire South Korean space programme has been forced to shut down after its only astronaut resigned for personal reasons.

Yi So-yeon, 36, became the first Korean in space in 2008 after the engineer was chosen by the Korea Aerospace Research Institute (KARI) to lead the country's 6 billion won ($25.4m, £14.9m) space project.

She spent 10 days in space with two Russian cosmonauts after the two countries reportedly agreed a fee of around £11.9m to let her fly the Soyuz TMA-12 spacecraft to the International Space Station.

During the mission, her role was described as Spaceflight Participant and her duties included monitoring the ways gravity changes the behaviour of 1,000 fruit flies taken on board the spacecraft in a special air-conditioned container box.

After going on leave in 2012 to study for a master's degree at the University of California, Yi has now resigned from the country's manned space programme citing personal reasons, effectively shutting down the entire operation.

Her resignation asked questions of KARI regarding whether she was the right person to lead the programme and whether the huge cost of sending her into space was a waste of taxpayers' money.

During an interview with BusinessWeek in 2013, Yi admitted South Korea had "no budget for a second mission".

Following her mission in 2008, South Korea became the third country, after the UK and Iran, to have a woman as its first space traveller.

China Asks Citizens to Walk and Ride Bikes to Cut Smog

A file photograph of people walking on a street past a power plant's cooling tower in Yingtan, Jiangxi province, China.Reuters

The world's most populous nation has finally identified public participation as a key factor in its attempts to battle pervasive pollution.

Beijing has published a 'behavioural standards' guide to reverse some of the environmental damage done by more than three decades of rapid economic growth, urging people to walk and ride bicycles and buy goods with less packaging.

The list of eight standards, published on the environment ministry's website on 13 August, urged citizens to avoid burning garbage, and limit the use of fireworks and barbecues.

It also urged the public to take responsibility for pollution by reporting unlawful behaviour to the authorities.

Tough Laws

Beijing in April passed amendments to the nation's 25-year old Environmental Protection Law, giving authorities more teeth against polluters.

The amendments go into effect on 1 January 2015, the official Xinhua news agency said on 24 April.

The highly-anticipated amendments followed public angst over air, water and soil pollution that has choked the world's second-largest economy.

A local government study showed in April 2014 that 31% of the smog in China's capital came from vehicles, 22.4% from coal burning and 18.1% from industry. 14.1% came from smaller sources such as food preparation, livestock rearing and vehicle repairs.

India's Sensex Ends Higher Despite Downbeat Data

India's Sensex ends higher despite downbeat macro-economic data.Reuters

India's benchmark 30-share average finished a tad higher on 13 August even after the government put out downbeat macro-economic data.

The S&P BSE Sensex share average finished 38.18 points, 0.15%, higher at 25,918.95 on a day when government data painted a depressing inflation picture in Asia's third-largest economy, which in turn followed disappointing industrial production data.

Retail inflation or the Consumer Price Index (CPI) inched up to 7.96% in July from 7.46% in June 2014, mainly because of higher priced vegetables, fruits and milk.

RBI's Hands Tied

ANZ Research said in a note to clients: "CPI inflation jumped back up to 8% driven by a spurt in food and core. Market hopes that the [central bank] would be in a position to cut rates were dealt a blow by resurgent inflation over July.

"Though IP growth disappointed, a deteriorating inflation outlook will effectively tie the hands of the [Reserve Bank of India]. We continue to forecast no change in rates in 2014."

Standard Chartered said in a note: "After a sharper-than-expected acceleration in July's CPI inflation to 7.96%, we acknowledge upside risk to our WPI inflation forecast of 4.9% y/y for July."

"June's WPI inflation picked up 5.4% y/y. However, a significant acceleration is unlikely given the favourable base effect.

"In contrast with a 5% increase in crude oil prices between June and July 2013, prices this year have declined by a similar amount. This is likely to keep the headline number in check. Core WPI inflation might move towards 4.0%," StanChart said.

"Given higher inflation prints, especially for the CPI, we maintain our call of no change in the repo rate in FY15 (ends March 2015)," StanChart added.

Worst is Over

Societe Generale Cross Asset Research said in a note: "We believe that the worst is now over for the Indian economy. We expect India's investment cycle to recover, albeit slowly, as the new government will likely be able to take steps aimed at removing hurdles to ensure that a fairly sizeable number of these projects are restarted."

"We expect that a more industry-friendly Land Acquisition Bill will become reality early next year while the process of granting environmental clearance has already been streamlined.

"Given the government's stated focus of revamping India's infrastructure which was reiterated in the current budget, we expect India's growth revival to materialise on the back of the uptick in investment activity in the country," SocGen said.

"However, progress will likely be slow as the benefits of such policy decisions will take some time to trickle down. Our baseline scenario is that over the next five years, India's gross investment rate will rise by around 3% of GDP and this could potentially push India's growth rate higher, to around 7% by FY2019 (Apr 18 to Mar 19) from the current 4.6%," SocGen added.

Sensex Outlook

Earlier in the day, Nomura analysts forecast the Sensex to touch 30,310 points by end-August 2015. The target implied a 17% gain from 12 August's close.

Nomura said in a note: "The cyclical pick-up in growth is being ignored by the market obsessed with bold policy and reform moves by the new government."

Government data released on 12 August showed that the Index of Industrial Production (IIP) slowed to 3.4% in June, from 5% in May, mainly because of lower output of consumer goods.

Mexico: Gynaecologist Sabina Mota 'Tortured by Relatives' After Delivering Stillborn Baby

A gynaecologist in Mexico was brutally tortured and left for dead after delivering a stillborn baby, it has been reported.

According to vancouverdesi.com, Dr Sabina Mota, 30, was attacked after finishing a night shift at the maternity ward she worked at in Zamora, in the state of Michoacan de Ocampo.

Her attackers cut off two of her fingers and tried to cut out her ovaries and womb. It is alleged the attackers were family members of a woman whose baby boy died during birth complications three weeks earlier.

Police spokesman Ulpio Fonseca said: "She was forced to take muscle relaxant drugs which made it impossible for her to fight back.

"Then she was tortured and mutilated in her own home for several hours by people we believe are related to a former patient. She had severe injuries and nearly bled to death."

Officers also told how she was forced to write a message on a wall in her own blood warning her colleagues that they would be next.

When Mota eventually came around, she screamed – alerting neighbours to her whereabouts. She was found chained up.

One of Mota's colleagues told police that the woman's family had turned up at the hospital, accusing her of killing the baby: "People often threaten doctors when things go wrong, but this family we now know clearly meant it."

Fonseca added: "The two are clearly linked and we are seeking the mother and members of her family who are currently missing."

China's Hanergy Buys Alta Devices for Low-Light Energy

Heliostats or mirrors that track the sun and reflect the sunlight onto a central receiving point, are seen at the Ivanpah Solar Electric Generating System in the Mojave Desert in the US.Reuters

Hanergy, a Chinese manufacturer of thin-film solar panels, has acquired US-based Alta Devices, and its technology which converts record amounts of solar energy in low-light conditions.

Hanergy will use Alta's technology in several applications including emergency charging of mobile phones and in cars, the Chinese firm said in a statement.

The firms did not disclose the financial terms of the deal.

California-based Alta Devices' thin film solar technology has a conversion efficiency of 30.8%, the highest among solar energy technologies available in the world, according to the statement.

Alta Devices uses gallium arsenide (GaAs) so its dual and single-junction solar cells can produce record-breaking conversion efficiencies of 30.8% and 28.8% respectively, as certified by the US National Renewable Energy Laboratory (NREL).

The deal will help Hanergy take on US-based First Solar, the largest maker of thin-film panels by shipments.

Hanergy chief executive Li Hejun said in the statement: "Alta Devices' thin film solar technology allows more energy to be produced in lower light conditions than any other type of solar cell, giving it greater potential to power a wide range of mobile devices and equipment from phones to cars.

"It has the potential to change the way solar energy is used. This acquisition advances Hanergy's goal to become the world leader in the solar technology of the future."

The Alta acquisition comes a year after Hanergy took over Arizona-based Global Solar Energy, which in turn followed the purchase of Silicon Valley start-up MiaSole in January 2013.

Earlier, in June 2012, Hanergy acquired German firm Q Cells's subsidiary Solibro.

Hot Shots Photos of the Day: Meteor Shower, Yazidi Exodus, Hyena Mouth-to-Mouth

Abass Yusuf holds meat on a stick in his mouth to feed a hyena in Harar, Ethiopia(AFP)

An woman who was attacked by a wolf pack reacts as she gets a haircut to keep her hair off the wound on her neck at a hospital in Urumqi, Xinjiang Uighur Autonomous Region, China. Five herder families in a village of Altay Prefecture attacked by the wolf pack(Reuters)

A squirrel runs in front of the guards of honour lined up during a full dress rehearsal for the 68th Independence Day celebrations at the Red Fort in New Delhi(AFP)

The winning team retrieves a goat from the water during the Deopokhari festival in Khokana. During the annual festival, a live goat is thrown into a pond and the team of devotees that retrieves the animal first wins(Reuters)

A meteor streaks over the Maculje archaeological site near Novi Travnik in Bosnia during the Perseid meteor shower(Reuters)

People take pictures and videos as tidal bores surge past a barrier on the banks of Qiantang River, in Jiaxing, Zhejiang province, China(Reuters)

A man carrying an umbrella stands behind stranded vehicles on a flooded street during heavy rainfall in Kunming, Yunnan province, China(Reuters)

Cars submerged in water along I-75 in Royal Oak, Michigan after the Detroit metropolitan area experienced the worst flash flooding in decades(Getty)

The Cathedral in Strasbourg, eastern France, is illuminated to celebrate its millennium(AFP)

A red sequinned gown worn by Marilyn Monroe in 'Gentlemen Prefer Blondes' and a Parliamentary Robe worn by Lord Lucan are displayed at Christie's Auction House in London(AFP)

Singer Lady Gaga arrives at Narita international airport in Japan(Reuters)

Jo Pavey of Britain celebrates after winning the women's 10,000 metres race at the age of 40 during the European Athletics Championships at the Letzigrund Stadium in Zurich(Reuters)

Real Madrid's Cristiano Ronaldo reacts as he poses with the trophy after winning the UEFA Super Cup final against Sevilla at Cardiff City stadium(Reuters)

US Secretary of State John Kerry speaks with five-year-old Dara Edwards, the daughter of an American staffer at the US Consulate in Sydney, as he meets embassy and consular staff(Reuters)

A Cuban man rides his bicycle past graffiti hailing former president Fidel Castro in Havana. Fidel Castro turns 88 today(AFP)

African migrants trying to enter the country by boat celebrate after being rescued by a Spanish coast guard vessel in the port of Tarifa(AFP)

An African migrant child smiles in a sports centre after being rescued by a Spanish coast guard vessel in Tarifa(AFP)

African migrants climb a border fence during an attempt to cross into Spanish territory between Morocco and Spain's north African enclave of Melilla(Reuters)

Displaced people from the minority Yazidi sect, fleeing violence from forces loyal to the Islamic State in Sinjar town, walk towards the Syrian border(Reuters)

Iraqi children from the Yazidi community wave to Kurdish Peshmerga forces near Dohuk in the region of autonomous Kurdistan(AFP)

Iraqis from the Yazidi community stand in a building under construction in Dohuk after they fled militants from the Islamic state (IS)(AFP)