Grim data deepens crisis - Malaysiakini

TOKYO - GRIM corporate earnings data from the world's biggest automaker and thousands of job losses underscored on Friday the urgency driving debate over Washington's massive economic stimulus plan.

Japan's Toyota Motor forecast an operating loss of US$4.9 billion (S$7.37 billion) for the financial year to March, after already losing US$4.0 billion in the third quarter alone as the global crisis sends car sales plunging.

British Airways, Japan Airlines and a clutch of other big corporate names announced or forecast dismal figures, and thousands more jobs are to face the axe across the world as companies try to make ends meet.

The slew of red ink and job cuts underlined the sense of emergency behind the US government's attempts to pass a 900-billion-dollar stimulus plan, which it says is needed to kick-start the faltering economy.

Negotiations to pass the bill entered their final stretch late on Thursday as the Senate wrapped up a fourth day of debate.

'I would hope that we can complete this legislation tomorrow. I have hopes and I'm cautiously optimistic that we can do that,' Democratic Senate Majority Leader Harry Reid told colleagues late on Thursday.

Mr Reid said he was waiting for the result of behind-the-scenes efforts by a group of moderate senators from both parties to forge a deal to win votes from Republicans, whose leaders say the bill is bloated and needs more tax cuts.

The plan attracted international controversy because of its 'Buy American' clause, which forbade stimulus spending on a project unless all of the iron, steel and manufactured goods involved were made in the United States.

Senators diluted the contested clause by saying it must be applied in line with US international trade agreements, but did not remove it.

Separately, the US Treasury Department confirmed a new bank stabilisation plan would be unveiled on Monday by Secretary Timothy Geithner, but offered no details.

The International Monetary Fund warned the US housing downturn may deepen and last longer than previously forecast, and the slump could spread to other countries.

The Bank of England cut its key lending rate by half a point, taking rates to 1.0 per cent - the lowest level in the bank's 315-year history.

Faced with a risk of deflation and with the economy in its first recession in 18 years, the central bank extended a series of drastic cuts since October, when interest rates had stood at 5.0 per cent.

'The global economy is in the throes of a severe and synchronised downturn,' the Bank of England explained.

The cut was in line with expectations and came shortly before the European Central Bank froze eurozone borrowing costs at 2.0 per cent ahead of a likely rate cut in March.

The major Asian markets were up on Friday. Tokyo closed up 1.60 per cent while shares in Hong Kong were up 1.42 per cent in afternoon trading. -- AFP