In a troubling sign for the global economy, the Chinese Bureau of Statistics on Friday reported that the powerhouse economy grew at its slowest pace since early in 2009, near the height of the global recession. The agency said the Chinese economy, second largest in the world behind the US, grew 7.6 percent in the second quarter, down from a growth pace of 8.1 percent in the January to March period. While a 7.6 percent expansion clip sounds massive in the US, whose economic growth came in at just 2 percent in the second quarter. But China's economy has surged at an average of 10 percent for some thirty years.
Global parcel carrier FedEx announced on Wednesday it has reached an agreement to acquire Rapidao Cometa to beef up its presence in the rapidly expanding market of Brazil. The Rapidao Cometa purchase will be FedEx's third international acquisition in less than two months as the company looks to offset domestic revenue declines by diversifying and expanding its business in overseas markets. FedEx said it expects the latest deal to close sometime in the third quarter, but did not disclose any financial details for the deal.
The US Federal Reserve announced on Thursday it has given its approval to three Chinese banking firms to increase their operations in the US by becoming holding companies through the purchase of American banks or the opening of a new branch. The move is believed to be the first time a Chinese institution has gotten approval to acquire a bank in the US, and experts say it could spur an increase in M&A activity as Chinese firms begin looking to get a foot in the door of the lucrative US banking sector while they know it's open.
General Motors announced on Monday it will open 600 new dealerships in the Chinese market this year, nearly doubling its production in an effort to regain momentum in the world's largest market for auto sales. China is easily the world's largest area for automakers but sales growth has slowed from 35 percent growth from 2010 to 2011 to a year-over-year increase of just 2 percent in the first quarter. Demand for vehicles in China, analysts say, has been tempered somewhat by government action aimed at slowing economic growth in the world' second-largest economy.
Caterpillar Inc announced on Wednesday it will invest $20 million in expanding a hydraulic facility in South Carolina. The world's largest manufacturer of construction and mining equipment said the expansion will create more than 80 new jobs over the next two years, nearly tripling the size of the Sumter, South Carolina facility from 100,000 square feet to 275,000 square feet. The plant is currently used to manufacture small hydraulic cylinders used in a wide variety of Caterpillar tractors and other equipment, but will begin making larger cylinders currently produced in the company's plant in Joliet, Illinois.
Dunkin' Brands Group announced on Wednesday it will more-than-double its number of restaurants in the US over the next twenty years. The company launched a highly successful initial public offering last year, boosting investor interest in the chain, which currently operates about 7,000 locations in the US. The company is looking to expand its presence westward from its roots in the Northeast, and also wants to expand into several international markets.
Facebook, the world's largest social network, announced on Monday it plans on opening a major software engineering center in New York early next year. While Facebook does have an office in the Big Apple, the announcement marks the first time the firm will open a software base of operations that is not located on the West Coast. The news also follows word of the social network's latest acquisition, the purchase of an Austin, Texas-based location sharing services firm, Gowalla.
According to the latest economic forecast from the National Association for Business Economics, the US economy will avoid slipping back into recession next year, though expansion won't come at a pace sufficient to make a significant dent in the nation's unemployment rate. The group forecast a growth rate for 2012 of 2.4 percent, which is only slightly higher than the 1.8 percent rate of expansion it is forecasting for the full year of 2011. Both estimates were revised upwardly from a NABE forecast issued in September.
The US Commerce Department reported Thursday that GDP growth accelerated during the third quarter, nearly tripling its pace from the first half of the year. The agency said that the economy grew at a 2.5 percent clip between July and September, after growth of just 0.9 percent in the first half of 2011. The report indicates that the economy is still improving, albeit rather slowly, even as investors were growing more concerned over a double dip recession and an economic collapse in Europe.
Southwest Airlines announced this week that it is putting off any expansion plans for the next couple of years due to the weak economy, and will instead focus its efforts on boosting earnings after acquiring AirTran. The purchase increased Southwest's capacity by about 25 percent, but the struggling economy is having a detrimental effect on leisure travel, as cash-strapped consumers cut back on discretionary spending.