:00:05. > :00:15.emergency shelters -- of Fiji. Now for the latest financial news,
:00:15. > :00:21.
:00:21. > :00:24.Fellow. You're with World Business Report. -- hello. Pressure grows on
:00:24. > :00:30.China to take action on long- standing trade restrictions with
:00:30. > :00:35.the US, as crucial trade talks get under way. I'm Rico Hizon in
:00:35. > :00:42.Singapore, Asian stock IRE kids are mostly higher boosted by US the
:00:42. > :00:45.Scot progress. -- stock markets. -- fiscal progress. The latest
:00:45. > :00:50.inflation numbers are once again expected to be above the
:00:51. > :01:00.Government's own target. But does it matter? Speculation mounts the
:01:01. > :01:02.
:01:02. > :01:06.targets could be removed altogether. The United States will press senior
:01:06. > :01:12.Chinese officials for action to tackle long-standing trade problems
:01:12. > :01:15.between the countries. A Chinese delegation, led by vice-premier, is
:01:15. > :01:19.in Washington today and tomorrow for talks with US Trade
:01:19. > :01:23.Representative Ron Kirk. He is expected to push China to drop
:01:23. > :01:28.restrictions on US livestock and farm products, and take stronger
:01:28. > :01:32.action to stop counterfeiting and piracy of American goods. After the
:01:32. > :01:39.war of words we have seen in the recent past, are we now in a new
:01:39. > :01:43.era of talking and diplomacy? I'm joined by Daniel, CEO of Kitum
:01:43. > :01:47.advisers, and asset management company that advises hedge funds.
:01:47. > :01:52.Thank you for joining us. We have a presidency that does not have to be
:01:52. > :01:57.re-elected and a new leadership in China. Is this the time for them to
:01:57. > :02:00.try and find more middle ground? These talks are not set up to
:02:00. > :02:04.necessarily have clear results, they are men for more high-level
:02:04. > :02:08.trade representatives to talk about issues -- meant for. This time
:02:08. > :02:13.around we will look for tone, is there a change because of the new
:02:13. > :02:16.leadership in China unless political pressure on Obama or not
:02:16. > :02:20.needing re-election? We will see if there is some change around some of
:02:20. > :02:24.the tone in these issues that they have been coming back to year after
:02:24. > :02:28.year without much resolution. it comes to the issues, I have
:02:28. > :02:33.mentioned a few of them, there's also the issue of the Chinese
:02:33. > :02:38.currency of course. What is most important for both sides? At the
:02:38. > :02:43.top of the list for the US, there's the currency issue. You have seen
:02:43. > :02:47.the Chinese one increase 10% since the government has come in. The US
:02:47. > :02:51.government still said it is undervalued and that is harming US
:02:51. > :02:57.exports. This year you will see the US Chinese trade deficit at an all-
:02:57. > :03:02.time high. From the Chinese perspective, they have a big
:03:02. > :03:07.immediate issue interest in the fiscal cliff discussion because of
:03:07. > :03:10.their large holdings of the federal debt. At the same time they have
:03:10. > :03:14.some continued concerns they have had for many years around
:03:14. > :03:17.restricting things like restrictions of high-technology
:03:17. > :03:22.goods, in China, as well as political pressure around some of
:03:22. > :03:26.their investments in the US. When it comes to who has got the upper
:03:26. > :03:31.hand, can we say? As you say from China's point of view, they hold a
:03:31. > :03:35.lot of US debt, an awful lot, so you would imagine they have got a
:03:35. > :03:40.trump card for that reason. But from the United States's point of
:03:40. > :03:48.view, the biggest on economy in the world, global leadership etc, who
:03:48. > :03:53.has got the upper hand? On the DET idea, sometimes it is overblown
:03:53. > :03:58.about the political weight that gives China in Washington. You see
:03:58. > :04:04.Japan has increased its Security Holdings and could overtake China
:04:04. > :04:14.as the largest holder of US foreign debt some time early next year. But
:04:14. > :04:21.that said, this is the US's main global competitor. So it is pretty
:04:21. > :04:26.much a discussion our money equals money -- of money equals money.
:04:26. > :04:30.Thank you for joining us. We will keep you up-to-date on any
:04:30. > :04:34.developments we hear about. Let's look at Asia now, shares across the
:04:34. > :04:38.board are gaining quite a bit of ground following a strong trading
:04:38. > :04:41.day in the US. It looks like politicians in Washington have made
:04:41. > :04:45.some progress in solving their differences over how to fix the
:04:45. > :04:50.fiscal cliff, the automatic spending cuts and tax hikes that
:04:50. > :04:55.are due to kick in in America on the 1st January. Let's go to Asia
:04:55. > :05:00.and speed to Rico Hizon. Nice to see you. It is the kind of story we
:05:00. > :05:05.want to hear at the moment, isn't it? -- speak to. They are finding a
:05:05. > :05:10.way of resolving this problem. have been hearing this story for
:05:10. > :05:15.the past month and a half, Sally. That's why Asian share markets have
:05:15. > :05:21.been dry rating with progress and on progress of these ongoing fiscal
:05:21. > :05:31.talks in the US -- John 'M' rating. Investors here are still on edge --
:05:31. > :05:32.
:05:32. > :05:39.John 'M' rating 0. The US is a key trading partner of the region. Asia
:05:39. > :05:43.cars, machinery, garments, consumer electronics, to the consumer hungry
:05:43. > :05:50.nation. That's not the only factor pushing regional stocks higher
:05:50. > :05:55.today, local issues are improving sentiment. Japan is doing well with
:05:55. > :05:59.the Nikkei up by 1.2 % today due to that last night's victory of the
:05:59. > :06:05.LDP party, which is pushing for more monetary easing and a weaker
:06:05. > :06:15.yen. Tokyo is closely followed Australian shares after the iron-
:06:15. > :06:20.
:06:20. > :06:24.ore prices got to a 5%. So far a good day for Asian markets. Thank
:06:24. > :06:29.you for joining us. Inflation in the UK is expected to fall slightly
:06:29. > :06:32.when figures are released later to 2.6 % in November. The price fall
:06:32. > :06:37.will be welcome news, but it is still a long way from the UK
:06:37. > :06:41.Government's own target of 2%. Many economists are now considering a
:06:41. > :06:46.future without inflation targets to aim for. In fact the Governor of
:06:46. > :06:49.the Bank of England has raised the idea of scrapping them altogether.
:06:49. > :06:53.The cost of The cost ofn Britain has been rising faster than planned for
:06:53. > :06:58.much of the last five years. The Bank of England asked to explain
:06:58. > :07:04.itself to the government if inflation consistently tops 2% --
:07:04. > :07:08.past two. It has missed that target in 42 out of the last 62 months. --
:07:08. > :07:12.Hastoe. We're living in quite extraordinary times. Over the last
:07:12. > :07:16.10 or so years the Governor of the Bank of England will tell you we
:07:16. > :07:20.have been within a fairly narrow range of the 2% target on average.
:07:20. > :07:25.But in the last few years we have been further away than normal. With
:07:25. > :07:30.any luck, all of these were the shots and oil price spikes and wars
:07:30. > :07:34.are a temporary thing and we can go back to -- and whether shots.
:07:34. > :07:38.current governor of the Bank of Canada is set to become the new
:07:38. > :07:42.head of the Bank of England in June. During a speech in Toronto he
:07:42. > :07:47.hinted that banks might have to look at new ways to help boost the
:07:47. > :07:51.economy. That fuelled speculation he may support scrapping inflation
:07:51. > :07:56.targets altogether, instead focusing on boosting the economy.
:07:56. > :07:59.Even the current governor of the Bank of England, Mervyn King, has
:07:59. > :08:05.admitted out while targets are important, it's crucial to consider
:08:05. > :08:09.the bigger picture, not just short- term targets. There may be
:08:09. > :08:13.circumstances in which it is justified to aim off the inflation
:08:13. > :08:19.target for a while in order to moderate the risk of financial
:08:19. > :08:24.crisis. Monetary policy cannot just mop up after a crisis. Risks must
:08:24. > :08:29.be dealt with before hand. I do not see this as inconsistent with
:08:29. > :08:33.inflation targeting. Speculation that inflation targets may be
:08:33. > :08:37.scrapped has divided top economists. Some believe it makes sense to
:08:37. > :08:41.explore new options. But others think the move could damage the
:08:41. > :08:45.credibility of the Bank of England. Either way there does not seem to
:08:45. > :08:51.be a quick fix to either keeping a lid on inflation, or boosting
:08:51. > :08:55.growth in the economy. Some other business stories, Morgan Stanley
:08:55. > :09:04.has agreed to pay a fine of $5,000,000.20 securities regulators
:09:04. > :09:14.in the US state of Massachusetts for withholding with information
:09:14. > :09:16.
:09:16. > :09:21.prior to the launch of Facebook. Morgan Stanley did not admit any
:09:21. > :09:27.killed but agreed to be censored and pay the fine. -- did not admit
:09:27. > :09:32.any guilt. A US judge has denied Apple's request for a permanent
:09:32. > :09:36.injunction against Samsung's smart phones. A one $1 billion in damages
:09:36. > :09:41.in August after a jury found Samsung had copied critical
:09:41. > :09:48.features of the eye at home and I sad -- iPhone and iPad -- they won
:09:48. > :09:51.$1 billion. Any injunction could potentially have been extended to
:09:51. > :09:56.Samsung's new LA Galaxy products, but US District Judge Lucy Cope
:09:56. > :10:01.said Apple had not presented a enough evidence to show its
:10:01. > :10:05.patented Features drove consumer demand for the entire iPhone.
:10:05. > :10:09.European Union fisheries ministers are meeting for two days of talks
:10:09. > :10:13.to set new annual fishing quotas. The UK is concerned about plans to
:10:13. > :10:19.cut cod quotas in the North Sea even though numbers are increasing.