Yellen: Fed should "proceed with caution" with an increase in rates

Janet YellenImage copyrightGetty Images
The US Federal Reserve chair Yellen system said that the Fed should "proceed with caution" before raising interest rates.

She said that global risks were not to have a profound impact on the US, but caution is still needed.

Global changes and risks have led politicians to draft a slower path of rate increases than initially expected in December, said Ms. Yellen.

US markets rose during his speech at the Economic Club of New York.

Her tone was similar to the Fed's statement in mid-March, when the central bank has not made any bid changes and guided the expectations with respect to the slower increase after the increase in December.

Ms. Yellen repeated his message from previous pubic speech that volatile oil prices and a slowdown in China, along with the way in the near future inflation will reach 2% target by the Federal Reserve, are the key factors governing the Fed to adopt a gradual approach to higher rates.

Omer Esiner, chief market analyst at Commonwealth Foreign Exchange, said that her caution was not surprising, but stood in contrast to the support for rate increases from other Fed speakers in recent days.

He added: "Ultimately, the comments [Yellen to] sound is not consistent with the looming hike rates in April and leave considerable doubt about whether the increase rates in June.

Earlier Tuesday, the head of the San Francisco Fed, John Williams, said that the US economy is doing "quite well."

As it has done in previous speeches, Ms. Yellen believes that the market should be open to the possibility of the news, which increases confidence.

"We must not ignore the greeting probability that economic conditions may be more favorable than we now expect," she said.

Audiences in New York laughed when Ms. Yellen was asked how long the Fed is expected to take to reach "normal" interest rate and whether she felt the market was not able to understand the bank's plan.

The Fed is trying to reassure markets of its "gradual" plan since the entry into force in December.

After the speech, Ms. Yellen, in a Wall Street rose sharply. S & P 500 rose 0.8% and the Nasdaq jumped 1.5%, while the index Dow Jones Industrial Average added only 0.1%.

Unconventional Instruments

Although the focus of his speech was on the interest rate, Ms. Yellen also consider other tools the Fed has at its disposal, if the US economy were to suffer a decline.

These innovative tools - including asset purchases, forward direction and negative interest rates, which have been used in Europe - have been criticized for helping the banks, not to stimulate the economy.

Ms. Yellen defended the use of these tools, saying they have helped prevent the recession to become worse.

"They were an effective policy, they have made a difference, and inflation could be lower and unemployment is higher - from the significant amounts - if we did not use this policy," she said.

Foxconn modify absorption Sharp

Imaginary walk before Sharp AQUOS "s flat-panel TVs in an electronics store in Tokyo, Thursday, February 25, 2016 Image copyrighted

Image Caption Sharp struggling with heavy debts and went through two main injections
Taiwanese manufacturer Foxconn says it has finally agreed to take on the struggling Japanese electronics company Sharp.

Foxconn said the deal is worth 389bn yen ($ 3.5bn, £ 2,4 billion) and give her a 66% stake in Sharp.
The Foxconn, which assembles most of the iPhones in the world, for the first time offered to invest in the troubled Japanese company in 2012, but the negotiations failed.

Both companies said that the deal will be signed on April 2nd.

This will be the first foreign capture of a major Japanese electronics firm.
Describing himself as a "world-class leaders in the technology industry", the Foxconn and Sharp announced that they will form a "historic strategic alliance."

The innovative firm

Established in 1912, Sharp is one of the oldest Japanese technology firm.
Japanese officials are reluctant to let it fall under foreign ownership because of the distinctive technology behind its display panels.

Prior to the announcement of the deal with Foxconn, Sharp discussing competing proposals from the government-backed consortium of Japanese investors.

Although in recent years there has been decline in his life, the company is still the leader in LCD technology, a key asset for Foxconn.

In 2012, Sharp was close to bankruptcy input. He is struggling with heavy debts and went through two main injections for the past four years.

Sharp innovations include mechanical pencil in 1915 and innovative developments in television technology.

Petrobras in Brazil ax 12,000 jobs

Petroleo Brasileiro--Petrobras-PBR-logo

State oil company of Brazil, of Petrobras, said it would cut 12,000 jobs by 2020.

voluntary dismissal program will save $ 9 billion in the company, which is struggling with losses following a price-fixing and bribery scandal.

It is also affected by the global downturn in oil prices.

Petrobras, which reported losses for the past two fiscal years, is expected to spend $ 1.23bn on the implementation of the plan of job cuts.

Petrobras has long been one of the largest employers in Brazil, with more than 80,000 employees.

However, he has seen his business suffered a huge drop in oil prices in the world and one of the biggest corruption scandals in the country's history, which went to the heart of the country's government.

The announcement that 12,000 jobs are to be cut over the next five years, the investment is part of the transformation plan over the fate of the company.

Analysis: Daniel Gallas, business correspondent in South America

This is not a good year for oil companies, as there is excess supply in the market and world prices hit records.

But of Petrobras - embroiled in a massive corruption scandal - things are even worse.

The company recorded two consecutive years of heavy losses and stopped paying dividends. Shares fell 50% in value since the beginning of the study.

A Chief Executive Aldemir Bendine to the crisis is to cut.

Petrobras drastically reducing their numbers - employees, assets and investments - in order to become competitive again.

If Petrobras, to become great again, he must first transform ourselves into a smaller and more efficient company.

It reported its biggest quarterly loss to date in the last three months of last year - $ 10.2 billion - after the loss of its oil fields and refinery projects.

Corruption scandal involving price-fixing, bribery and political setbacks in the past two years dented confidence in the business. Some former leaders of Petrobras were imprisoned.

The scandal has also harmed the reputation of President Dilma Rousseff, who was on the board of the company at the time of the crimes.

Ms. Rousseff faces the possibility of impeachment on the misuse of false statements.