Tuesday, September 16, 2003

Business digest


Fed rate change seen as unlikely

From wire reports

WASHINGTON - Even though U.S. companies are reluctant to hire workers, the economy over the second half of this year is expected to grow at the fastest pace since 1999.

That surprisingly upbeat prospect means that the Federal Reserve will see no need to cut interest rates at today's meeting, private economists believe.

Analysts believe interest rates will not move until the central bank sees convincing evidence that the jobless rate, now at 6.1 percent, is falling on a sustained basis and companies are finally beginning to rehire workers.

Steelworkers approve Goodyear contract

PITTSBURGH - Goodyear Tire & Rubber Co. employees approved a proposed three-year contract, allowing the nation's biggest tire company to contain health care, benefit and wage costs in return for job security, company and union officials said Monday.

The agreement was approved by about 70 percent of the United Steelworkers' Goodyear employees who voted and all but one of the company's 14 union locals. Ratification required approval by at least eight locals and an overall majority.

The contract, which replaces one that expired April 19, covers at least 16,000 employees at 14 plants in Ohio, Virginia, North Carolina, Illinois, Alabama, Nebraska, Wisconsin, New York, Kansas, Texas and Tennessee, plus about 22,000 retirees.

Interest rates fall in Treasury bill auction

WASHINGTON - Interest rates on short-term Treasury securities fell in Monday's auction.

The Treasury Department sold $14 billion in three-month bills at a discount rate of 0.930 percent, down from 0.935 percent last week. An additional $14 billion was sold in six-month bills at a rate of 0.995 percent, down from 1.010 percent.

Industrial output edges up 0.1% in August

WASHINGTON - Industrial production edged up by just 0.1 percent in August, restrained by weakness in manufacturing, especially for big-ticket goods such as automobiles.

The Federal Reserve said Monday the small increase in industrial activity came after a revised 0.7 percent advance in July, even stronger than the 0.5 percent first reported.

In a second report, stocks of unsold goods at the nation's businesses inched down by 0.1 percent in July as sales increased by the largest amount in four months, a sign that companies remain wary of increasing inventories amid other indications of economic strength.

KFC president resigns amid sluggish sales

LOUISVILLE - The U.S. president of Yum! Brands Inc.'s struggling KFC chain has resigned her post at the huge chicken restaurant business, which is mired in a months-long slide in sales.

Cheryl Bachelder, who has been president of KFC's domestic operations since early 2001, stepped down to pursue unspecified other interests, Yum said Monday.

Yum, the parent company of KFC, Pizza Hut and Taco Bell said Bachelder is being replaced by Gregg Dedrick, 44, a veteran Yum executive who spent the last two years as a strategic adviser to the fast-food giant.

OPEC might invite Iraq to attend oil meeting

LONDON - OPEC might invite Iraq's newly installed oil minister to next week's meeting of the cartel even without prior U.N. recognition of the new interim government in Baghdad, the cartel's president said Monday.

Iraq hasn't attended meetings of the Organization of Petroleum Exporting Countries since the U.S.-led invasion this spring, and it hasn't participated in the group's output agreements since the Gulf War of 1991.




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