Fed stands by stimulus, sees stronger economy
WASHINGTON - The Federal Reserve isn't yet convinced that the U.S. economy's growth can accelerate without the Fed's drive to keep borrowing costs at record lows. It wants to see sustained improvement.
That was the message Fed officials sent Wednesday, when they reinforced their plan to keep short-term interest rates at record lows at least until unemployment falls to 6.5 percent.
The Fed will continue buying $85 billion a month in bonds indefinitely to keep long-term borrowing costs down. Fed chief Ben Bernanke said the Fed might vary the size of its monthly purchases depending on whether or how much the job market improves.
The unemployment rate has fallen to a four-year low of 7.7 percent, among many signs of a healthier economy.
The Fed said the U.S. job market has improved, consumer spending and business investment have increased and the housing market has strengthened. But its latest economic forecasts, also released Wednesday, show that the Fed still doesn't expect unemployment to reach 6.5 percent until 2015.
Freddie accuses big banks of rigging key interest rate
WASHINGTON - Freddie Mac has sued 15 big international banks, including JPMorgan Chase, Bank of America and Citigroup, accusing them of rigging a key interest rate and causing huge losses for the government-controlled mortgage giant.
Freddie names the banks that set the London interbank offered rate, known as LIBOR, which provides the basis for trillions of dollars in contracts around the world, including mortgages, bonds and consumer loans.
In a growing scandal, two big British banks and Switzerland's largest have been fined hundreds of millions of dollars by U.S. and British regulators for manipulating LIBOR.
Congress oddly quiet about Dreamliner woes
WASHINGTON - As Boeing, its airline customers and federal safety regulators struggled over the past two months to solve problems with the new 787 Dreamliner's fire-plagued batteries, one player has been strangely silent: Congress.
Despite the plane's grounding and the safety issues raised by its cutting-edge technology, there have been no congressional hearings or news conferences focusing on the problems, and little commentary from lawmakers who normally pounce at the first sign of trouble.
The unusual bipartisan silence reflects Boeing's political clout, wielded by legions of lobbyists, fueled by hefty political campaign contributions and by the company's importance as a huge employer and the nation's single largest exporter. Few companies are as well positioned as Boeing to fend off a potentially damaging public investigation.
FedEx profit falls 31%; airfreight business weak
FedEx said Wednesday that third-quarter profit fell 31 percent as customers shifted to slower and less expensive international air-shipping options, and it cut its forecast of full-year earnings.
Cypriot officials: Plan B drawn up to obtain bailout
NICOSIA, Cyprus - Cyprus' government has drawn up a new plan to raise funds needed for the country to secure a crucial international bailout, three top government officials said Wednesday.
Searching for a way out of a crippling financial crisis, officials in Cyprus pursued a new bailout strategy that could include a loan from Russia in exchange for natural gas leases and selling off assets from its most troubled banks.
The new bill could be voted on as early as this evening.
Parliament resoundingly rejected the previous plan, which involved taxing up to 10 percent of people's bank deposits. The rejection threw Cyprus' bailout into question, raising the possibility the country's banks could collapse, the government would be unable to pay its bills and Cyprus could be forced out of the eurozone.
Big Chinese solar producer is forced into bankruptcy
BEIJING - Suntech, one of the world's biggest solar panel manufacturers, was forced into bankruptcy court Wednesday, becoming the latest casualty of a painful slump in the global solar industry. The company had announced recently that it will close its Arizona plant in Goodyear.
Suntech Power Holdings Ltd. said eight Chinese banks asked a court to declare it insolvent after the company missed a $541 million payment to bondholders last week. Suntech said it will not oppose the petition.
The development is a dramatic reversal for a company that was a leading force in China's fast-growing renewable-energy industry. Its founder, Shi Zhengrong, has seen much of his multibillion-dollar fortune evaporate.
Airlines raise outlook
GENEVA - The airline industry has forecast a modest improvement in global net profits for 2013, the International Air Transport Association said Wednesday.
The Associated Press