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Don Miller

The Only U.S. Automaker on Track, Ford Posts $2.1 Billion First-Quarter Earnings

Ford Motor Co. (NYSE: F) beat Wall Street estimates by posting first-quarter earnings of $2.1 billion and said it will deliver a "solid profit" for all of 2010, a year earlier than Chief Executive Officer Alan Mulally had projected previously.

Reaping the benefits from a recovering auto market and higher prices for cars and trucks, Ford chalked up its fourth consecutive quarter of net income, the longest streak since 2005.

Ford's U.S. deliveries surged by 37%, more than twice the industry wide average through March, boosting domestic market share at the fastest pace in 33 years. Ford was the only U.S. automaker to avoid bankruptcy in 2009.

First-quarter revenue rose 15% to $28.1 billion, and net income after one-time charges was 50 cents a share, handily beating the projected adjusted earnings of 31 cents a share compiled by Bloomberg . The Dearborn, Michigan based company posted a net loss of $1.43 billion, or 60 cents, a year earlier.

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Greece's Action on Aid Package Fails to Quiet Threat of Debt Contagion

A request by Greece to trigger a $60 billion rescue package has failed to quell turmoil surrounding the country's bonds – heightening concerns that the debt contagion will force the European Union (EU) to bail out the region's other heavily indebted nations.

Greece on Friday asked the International Monetary Fund (IMF) and European governments to fund the emergency aid package to help fend off default when debt payments come due next month.

But instead of stabilizing the markets, uncertainty about Germany's willingness to fund its portion of the package, along with the potential for more bailouts, raised the cost of insuring Greek debt against default to a new record.

The euro plummeted after briefly bouncing off a 12-month low of $1.32 against the dollar Friday.

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India and Brazil Join U.S. in Pressuring China to Let Yuan Appreciate

President Barack Obama's efforts to pressure China to let the yuan appreciate gained momentum Thursday when the central bank presidents of Brazil and India both spoke out against China's exchange rate policy. Speaking ahead of a Group of 20 (G20) meeting scheduled for this weekend in Washington, the Indian and Brazilian central bank heads surprised […]

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China's Explosive GDP Growth May Force Government to Raise Yuan and Interest Rates

China's economy raced ahead in the first quarter at the fastest pace in almost three years, underscoring concerns about overheating and prompting speculation that the government will be forced to raise interest rates in addition to scrapping the yuan's peg to the dollar. China's gross domestic product (GDP) rang up unexpectedly strong annual growth of […]

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New $61 Billion Aid Package Is No Cure For Greece's Long Term Ills

After an extraordinary teleconference on Sunday, Eurozone members offered Greece a rescue package worth as much as $61 billion (45 billion euros) at below-market interest rates. But even though the aid package sparked a rally in Greek stocks and bonds, it probably won't be enough to cure the debt-plagued nation's long-term ills.

A surge in Greek borrowing costs last week sent yields to an 11-year high, forcing European finance ministers to take action. The result was an offer of as much as $40.7 billion (30 billion euros) in three-year loans over the next year. Another $20 billion (15 billion euros) in aid could come from the International Monetary Fund (IMF).

The interest rates charged to Athens would be around 5% for a three-year fixed loan – above the IMF's standard lending rate but below the 7.45% jittery investors were getting for purchasing Greek bonds last week.

"This is a huge amount," Stephen Jen, managing director at BlueGold Capital Management LLP in London and a former IMF economist, told Bloomberg News. "This is more than a bazooka. They have gone nuclear on the issue of Greece. In the short run, the market is short Greek assets so we'll get a rally in those."

News of the rescue package sent prices higher for short-term Greek debt vehicles, reflecting a lighter mood among investors who sensed a much lower risk of a debt default.

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China May Let Yuan Appreciate Despite First Trade Deficit in Six Years

China's imports pushed higher in March, which may cause the Asian economic powerhouse to post its first trade deficit in six years.  But even though the deficit bolsters its argument for keeping the yuan pegged to the dollar, it appears Beijing will let its currency appreciate in the near future.

Rising commodity prices probably led imports to outpace exports by $390 million in March after a $7.6 billion trade surplus the previous month, according to the median estimate in a Bloomberg News survey of 26 economists.

Nevertheless, a change in China's currency policy is "imminent", and may occur in the next few weeks, Ben Simpfendorfer, a Hong Kong- based economist at Royal Bank of Scotland Group Plc (NYSE ADR: RBS), said Friday on Bloomberg Television.

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Odds of IMF Bailout Increase as Greek Bond Prices Plummet

Prices for Greek 10-year bonds plummeted to record lows today (Thursday) on speculation Europe's most troubled economy is about to unravel.

Economists expressed new doubts over the country's banks and short term funding plans and warned that recent developments now threaten to create a vicious cycle of bad news.

"The fear factor is beginning to creep in. In fact, it's galloping in," Neil Mellor, a senior currencies analyst at Bank of New York Mellon Corp. (NYSE: BK) in London told The Wall Street Journal.

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Geithner's China Jaunt May Signal Easing of Tensions on Yuan

In a surprise move, Treasury Secretary Timothy Geithner will meet with Chinese Vice Premier Wang Qishan in Beijing today (Thursday), as speculation increases that China is considering letting its currency, the yuan, rise against the dollar.

The unexpected meeting was arranged on-the-fly after Geithner's scheduled trip to India, and may be a sign that both countries are seeking to defuse the currency issue ahead of Chinese President Hu Jintao's trip to Washington next week.

The move follows the Treasury Department's decision last weekend to delay a decision on whether to label China a "currency manipulator."

"[China is] becoming more open to the world, and with that, you're going to see the [yuan] take on a broader role internationally," Geithner said in a Bloomberg Television interview in Mumbai as he finished preparations for the previously unscheduled visit to China. "That's a healthy, necessary adjustment."

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China Manufacturing Data Could Presage a Rising Yuan

Manufacturing activity in China and much of Asia continued to expand in March, underscoring the region's role as a driving force in the global economic recovery.

China's official Purchasing Managers' Index (PMI) rose to a seasonally adjusted 55.1 from 52 in February, according to Li & Fung Group, a Hong Kong-based company that releases data for the Federation of Logistics and Purchasing. It marked the 13th straight month the index showed expansion and was in line with the median estimate in a Bloomberg News survey of 13 economists. A reading above 50 indicates growth.

Another PMI for China released by HSBC Holdings PLC (NYSE ADR: HBC) was even more positive, showing a rise to 57.0 in March from 55.8 in February.

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Treasury to Sell $7.7 Billion Stake in Citigroup in "Orderly and Measured Fashion"

The U.S. Treasury Department said yesterday (Monday) that it plans to sell the government's $7.7 billion stake in Citigroup Inc. (NYSE: C) this year, bringing the bank one step closer to leaving the bailout program.

"Treasury intends to sell its Citigroup common shares into the market through various means in an orderly and measured fashion," the Treasury said in a statement. "The manner, amount and timing of the sales under the plan is dependent upon a number of factors."

The Treasury said it would use a "pre-arranged written trading plan," but did not elaborate further.

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