Mitsui & Co enjoys a moderate growth in US during H1
May 05, 2008 - Japan
Mitsui & Co Ltd announced its consolidated financial results for the year ended March 31, 2008.
The global economy continued to expand vigorously supported by generally sound fundamentals and strong momentum in the Asian economy, led by China, and resilient activities in Europe and Japan, despite increasing uncertainty about the outlook of the United States with concerns that financial market strains could deepen and trigger a more pronounced economic slowdown.
Continued run-up of prices of internationally traded commodities such as metals and crude oil, as well as continued strong growth of domestic demand in emerging countries including BRICs for capital investment and consumption were the two major factors influencing the operating results and businesses of Mitsui and its subsidiaries.
These factors particularly boosted operating results of Mitsui & Co Ltd and its subsidiaries’ mineral resources and energy related activities and supported steady business performance in steel products, machinery & infrastructure and chemicals.
On a regional basis, the business sentiment in the United States, which enjoyed a moderate growth during the first half as a result of healthy consumer spending reflecting robust performance in the business sector and growth in real disposable income, deteriorated significantly in the second half reflecting financial stress which erupted in August 2007 as the subprime mortgage market was derailed leading to tightening of credit conditions, considerable deceleration of consumer spending due to sharp increases in the prices of crude oil and food products, as well as softening of the labor market.
European economy slowed down moderately as construction investments peaked out in the region. In Japan, export to emerging economies of automotive as well as steel and chemical products supported high level of industrial production.
On the other hand, uncertainties increased in corporate and household sectors reflecting decline in construction investments caused by revision of the Japanese building standards law as well as rising material costs and consumer goods including foodstuff.
Looking into monetary and foreign exchange markets, the Federal Reserve Board of the United States implemented a series of interest rate cuts to stabilize financial market.
In foreign exchange markets, the U.S. Dollar continued to depreciate against most major currencies, and fell below ¥100/ U.S. Dollar in March 2008, the lowest value in 13 years. Furthermore, stock markets worldwide saw falling share prices in the latter half of the fiscal year.
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