A short summary of this week’s business news.
Hungary is now the first European Union country to receive financial assistance from the IMF. The International Monetary Fund (IMF) is an international financial institution that lends money to countries that are in a financial crisis. The IMF has given financial support (i.e. loans) to Belarus, Iceland, Pakistan and Ukraine in the last week. It has created a $100bn fund to help countries affected by the credit crisis.
German authorities are investigating trading in Volkswagen’s shares after they quadrupled on Monday and Tuesday. On Monday, Porsche announced that it is going to increase its holding in Volkswagen with a view to a possible takeover. It is believed the rapid increase in the share price of Volkswagen was due to short-sellers (who bet that VW’s share price would fall) covering their positions by rapidly buying up stock in Volkswagen.
Talks between Aer Lingus and trade unions have broken down at the Labour Relations Commission. So, what is the next step in negotiations?
Finally, the trend in global interest rates is downwards. The US Federal Reserve cut rates by another 0.5% in order to help the US economy. It has now cut rates from 5.25% in September 2007 to 1% today. Will the Bank of England and the ECB follow?