27/06/2025

BIZ & FINANCE FRIDAY | JUNE 27, 2025

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South Korea’s Lee urges approval of extra budget SEOUL: South Korea’s President Lee Jae Myung yesterday called on Parliament to approve a US$22.5 billion (RM95 billion) supplementary budget aimed at reviving the economy, in his first address to MPs since taking office. Lee was elected in a snap vote this month following the impeachment of his predecessor, Yoon Suk Yeol, over his martial law declaration in December. The new president’s appeal comes as Asia’s fourth-largest economy – heavily reliant on exports – reels from steep tariffs imposed by US President Donald Trump. In April, the United States slapped a 25% tariff on South Korean goods as part of Trump’s sweeping global trade measures. The rates were later put on a 90-day hold, giving both sides until July to reach a deal. “Timing is everything when it comes to the economy, and now is the time to act,” Lee told lawmakers. “To overcome the downturn and restore livelihoods, we have drafted a supplementary budget totalling 30.5 trillion won,”he said, adding the package was designed for swift implementation. More than 40% of the spending would go towards universal consumption coupons, according to the proposal, with individuals eligible for up to 520,000 won (RM1,607) each. He described the measure as “the minimum” his government could do to breathe life into the economy. Lee’s request is widely expected to pass, as his centre-left Democratic Party commands a majority in the 300-seat legislature. – AFP SAN FRANCISCO: Meta CEO Mark Zuckerberg has hired three OpenAI researchers to join his“superintelligence” team, the Wall Street Journal reported on Wednesday, days after OpenAI CEO Sam Altman accused the Facebook owner of trying to poach its employees. An OpenAI spokesman confirmed the departure of the three employees from the firm, without giving further details. Meta did not immediately respond to a request for comment outside regular business hours. Meta Platforms hired Lucas Beyer, Alexander Kolesnikov and Xiaohua Zhai, who were all working at the ChatGPT-owner’s Zurich office, the WSJ reported, citing sources. Last week, Altman said Meta had offered his employees bonuses of US$100 million to recruit them. Once recognised as a leader in open source AI models, Meta has suffered from staff departures and postponed launches of new open-source AI models that could rival competing models from Google, OpenAI, and China’s DeepSeek. “I’ve heard that Meta thinks of us as their biggest competitor,” Altman had said. Meta recently hired 28-year-old Scale AI CEO Alexandr Wang to work on its “superintelligence” efforts. The company also took a 49% stake for US$14.3 billion in Scale AI. Meta Platforms is now trying to paint a turnaround as reports suggest Zuckerberg is setting up a team of experts to achieve so-called “artificial general intelligence”. – Reuters Meta poaches three OpenAI researchers

Powell greeting interns before testifying to the House Financial Services Committee in the Rayburn House Office Building on Capitol Hill. – AFPPIC

Trump considers naming next Fed chief early: WSJ

central bank to be careful in considering further rate cuts. Fed officials still expect to cut interest rates this year, with two priced in by markets but the timing is uncertain as officials wait on looming trade deadlines and for more certainty about the scope of the tariffs. “With the drop in US yields and speculation about the next Fed chair, investors are considering the impact of a move dovish Fed, and the dollar is feeling the heat,” said Legal & General Investment Management strategist Ben Bennett. “(This week’s) PCE inflation data is going to be important.” Traders are now pricing in nearly 25% chance of the Fed cutting rates in its end of July meeting compared to 12.5% last week, the CME FedWatch tool showed. The two-year US Treasury yield, which typically moves in step with interest rate expectations, was down 1.5 basis points at 3.764%, its lowest level in seven weeks.

“CATL, Huayou Cobalt, PT Antam ... must commit to respecting the rights of local communities and the environment before breaking ground,” said Brad Adams, executive director at Climate Rights International, in a statement. “Communities are repressed, forests are cleared, and pollution goes unaddressed with impunity. “This is a chance for the Prabowo government to show that it has learned from those failures.” Halmahera hosts the world’s largest nickel mine by production Financial markets remain on edge over Trump’s chaotic trade policies as the clock ticks down to his July 9 deadline for trade deals. Powell, who resumed two days of congressional testimony on Wednesday, said Trump’s tariff plans may well just cause a one-time jump in prices, but the risk it could fuel more persistent inflation is large enough for the bank’s independence. “I think it’s a given that Trump’s pick to succeed Powell, when it comes, will be one that sits at the highly dovish end of the spectrum and will support Trump’s agenda of lowering interest rates,” said Tony Sycamore, market analyst at IG. “The issue with this is it will resurface questions from earlier in the year around the Fed’s independence, which, as we saw, undermines confidence in the Fed and the USD.” The dollar index, which measures the US currency against six rivals, wallowed at its lowest level since March 2022. The index has slid 10% this year as investors, worried by Trump’s tariffs and their impact on US growth, look for alternatives.

o Stocks wobble, dollar slips on prospect of ‘shadow’ Federal Reserve chairman

SINGAPORE: stocks wobbled and the dollar was under pressure yesterday as the prospect of an early appointment of the next Federal Reserve chair by President Donald Trump stoked concerns over the independence and credibility of the US central bank. The US dollar selling kicked up a notch after a media report said Trump has toyed with the idea of selecting and announcing Jerome Powell’s replacement by September or October in a bid to undermine his position. A move like that is seen by some analysts as an effort to influence monetary policy through a “shadow” Fed chair even before Powell leaves office in May 2026. While markets have been soothed by a ceasefire between Israel and Iran that appeared to be holding, reducing the risks of disruptions to the oil trade and underpinning sentiment, traders JAKARTA: Environmental groups raised concerns yesterday over a US$6 billion Indonesian EV battery megaproject backed by Chinese giant CATL which is set to open on a once-pristine island, as Jakarta exploits its huge supply of nickel. Indonesia is both the world’s largest nickel producer and home to the biggest-known reserves, and a 2020 export ban has spurred a domestic industrial boom. Indonesian President Prabowo Subianto will inaugurate the project – also backed by China’s Zhejiang Asian

are on edge about Trump’s July 9 deadline on imposing tariffs on trading partners and his pressure on the Fed. In stocks, MSCI’s broadest index of Asia-Pacific shares outside Japan was slightly higher as the rally in Wall Street took a breather overnight. Tokyo’s Nikkei rose 1.5% to highest since lat January. European stock futures pointed to a muted open with currency markets taking the spotlight. The euro firmed to its strongest level since September 2021 and last fetched US$1.6837. The Swiss franc firmed to a decade-high while the Japanese yen strengthened 0.3% to 144.815 per dollar.

Trump has repeatedly criticised Powell for not cutting interest rates and has floated the idea of firing him or naming a successor soon, denting investor confidence in US assets and undermining the central NGOs concerned about Indonesia EV battery project “No one knows exactly how tariffs will impact inflation, which will keep central banks in conservative mode,” said Bank of America strategists. – Reuters

Weda Bay, where operations have grown and sparked reports of widespread environmental damage. Greenpeace Indonesia said the new project carried “great responsibilities”and the environment and locals“must not take a back seat” to powering electric vehicles. “If the environment and the rights of our most vulnerable people are not prioritised now... we will all pay a high price through worsening biodiversity and climate crises,” said Arie Rompas, forest campaign team leader at Greenpeace. – AFP

Huayou Cobalt and Indonesia’s state-owned Antam – in the east of Halmahera in Indonesia’s Maluku islands on Sunday. The complex will encompass a process from nickel mining to production of cathodes, state news agency Antara reported. But NGOs say Indonesia and the Chinese firms involved have not given assurances about environmental protections at the site, located just kilometres from a huge industrial park where spikes in pollution and deforestation have been reported.