Morning Market Roundup: German Prez Resigns, Italy Confiscates Billions in Fake U.S. Bonds
Here’s what’s important in the financial world this morning:
Germany: Germany’s president resigned on Friday amid a scandal over political favors, dealing a heavy blow to German Chancellor Angela Merkel in the midst of the debt crisis.
German President Christian Wulff, hand-picked by Merkel, gave a brief five-minute statement at the Bellevue presidential palace in which he said he had lost the trust of the German people, making it impossible for him to continue in a role that is meant to serve as a moral compass for the nation.
“For this reason, it is no longer possible for me to exercise the office of president at home and abroad as required,” Wulff said. After Wulff spoke, Merkel made a brief statement saying she regretted his departure.
Italy: Authorities in Switzerland have confiscated $6 trillion in counterfeit U.S. bonds at the request of Italian prosecutors, authorities said Friday.
In Italy, eight people were arrested across the country and placed under investigation for fraud and other crimes.
The bonds, carrying the false date of issue of 1934, had been transported in 2007 from Hong Kong to Zurich, where they were transferred to a Swiss trust, according to prosecutors in the southern Italian city of Potenza.
Authorities said that U.S. officials had confirmed the bonds were counterfeit.
Prosecutors said the fraud had not been completed, but that it appeared that the suspects intended to try to sell the fake bonds to a developing nation, directly or through an intermediary bank.
Recently, Carabinieri carrying out a routine search at a highway rest stop found a briefcase containing $20 billion in fake bonds.
U.S. Cost of Living: Consumer prices rose in January on higher costs for food, gas, rent and clothing. But economists downplayed the increase, saying “inflation will likely ease in the coming months as prices for raw materials level off.”
The consumer price index increased 0.2 percent last month, after a flat reading in December, the Labor Department said Friday.
Excluding volatile food and energy, so-called “core” prices ticked up 0.2 percent. A big reason for the increase was that clothing prices jumped 0.9 percent. Medical care, rent and tobacco prices also increased.
Car prices were unchanged, and airfares fell.
Core inflation over the past 12 months moved up to 2.3 percent – its highest point in more than three years. A steady rise in core prices could limit the Federal Reserve’s ability to take steps to boost the economy
Asia: Asian markets were higher in overnight trading with the Nikkei up 1.58 percent, Business Insider reports. Europe is higher on news that Greece may be closer to a bailout and U.S. futures are flat.
[Editor’s note: portion of the above originally appeared on Wall St. Cheat Sheet. The Associated Press contributed to this report.]
Posted on February 17, 2012, in Blog, Finance and tagged Business, Germany, Global Economy, Italy. Bookmark the permalink. Comments Off on Morning Market Roundup: German Prez Resigns, Italy Confiscates Billions in Fake U.S. Bonds.