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New York, NY, United States (AHN) – The United States economy grew at a slow 1.9 percent pace during the first quarter of the year a slowdown in growth that Federal Reserve policy makers hope will only be a temporary.

In contrast, the economy grew at a more robust 3.1 percent rate in the previous quarter. Still the 1.9 percent figure was better than the 1.8 percent rise in gross domestic product predicted for the first quarter by government officials last month.

Real gross domestic product is the total output of goods and services produced by labor and property located in the U.S.

“The increase in real GDP in the first quarter primarily reflected positive contributions from personal consumption expenditures (PCE), private inventory investment, exports, and nonresidential fixed investment that were partly offset by negative contributions from federal government spending and state and local government spending. Imports, which are a subtraction in the calculation of GDP, increased,” the U.S. Department of Commerce Bureau of Economic Analysis said in a statement.

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Premier Wen Jiabao said that China’s efforts to stem inflation have worked and that the pace of consumer-price increases will slow, an assessment that contrasts with some economists advocating further steps.

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Toronto, Ontario, Canada (AHN) – Large Canadian banks reduced their residential mortgage rates by one-tenth of a percentage point for mortgages of one to 10 years.

With the reduction, the rate for a five-year closed mortgage is now 5.49 percent at the Bank of Montreal, Royal Bank of Canada, TD Canada Trust, Scotiabank and the Canadian Imperial Bank of Commerce.

The first four banks announced their home mortgage rate cuts last week, while CIBC announced it on Monday.

Interest rates for long-term loans are down due to concerns over the health of the global economy and the chances that the Bank of Canada will not raise its benchmark lending rate until the second half of 2011, at the earliest.

Analysts forecast the Canadian central bank will leave the key lending rate at one percent for the sixth straight time when the bank meets on Tuesday.

An analyst of Scotia Capital predicted that Bank of Canada Governor Mark Carney would even hold on to the current interest rate into 2012.

The Organization for Economic Cooperation and Development urged the Bank of Canada last week to approve at least one rate increase in the coming months to show to consumers and businesses that it is doing something to address inflation.

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Vancouver, British Columbia, Canada (AHN) – British Columbia Premier Christy Clark announced a plan to increase business taxes in the province to make up for a proposal to reduce the controversial harmonized sales tax.

BC plans to reduce the HST rate to 10 percent from 12 percent. In turn, Clark announced that by 2012 the province’s corporate tax rate would increase to 12 from 10 percent. Clark’s plan would reverse the previous BC policy of reducing corporate taxes to encourage competition and help create jobs.

The HST rate, however, would be reduced in phases. Clark said the cut would initially be by 1 percent to 11 percent by July 2012 and by another 1 percent to 10 percent by July 2014.

Until the HST tax rate is cut 10 percent by 2014, BC residents would have paid $185 more a year for goods and services they purchased. When the rate is down to 10 percent, it would be the only time that British Columbians would gain by $120 annually.

BC voters are scheduled to decide on the fate of the HST in a referendum. Ballots are expected to arrive by mail at homes in early June and must be returned to Elections BC by mail or delivered personally to a Service BC office by July 22.

If the “Yes” votes prevail, BC would return to the old general sales tax and provincial sales tax systems before the Liberal-led government integrated the two into the HST in July 2010.

The opposition New Democratic Party is waging a campaign for BC residents to turn down the HST, but did not offer to reduce the rate. NDP leader in BC Adrian Dix said the Liberal’s proposal to cut the HST rate would favor big businesses over families. Dix added the Liberals can’t be trusted to keep the promised to lower the HST rate.

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Manila, Metro Manila, Philippines (AHN) – The Philippines registered a higher-than-expected 4.5 percent inflation rate for April on Thursday.

The 12-month high inflation rate prompted the Philippine Central Bank to increase the key lending rate by 25 basis points in a bid to contain inflationary pressure.

The last time the country logged a 4.5 percent inflation rate was in April 2010. For the first four months of 2011, the average inflation rate – triggered by higher prices in most commodity groups – was 4.2 percent, according to the National Statistics Office.

Following the higher inflation rate revelation, the Philippine Central Bank’s Monetary Board adjusted the benchmark lending rate to 4.5 percent, the second 25-basis points increase in two months approved by the board.

The board increased higher interest rates to discourage loans and slow down consumer spending, while encouraging savings.

The aim of the higher interest rate is to limit inflation this year and in 2012 to a range of 3 to 5 percent. Price increases were recorded in the following items:

• Fuel, light and water – 8.8 percent
• Services – 6.5 percent
• Clothing – 1.9 percent
• Housing and repairs – 2.2 percent, and
• Miscellaneous goods – 1.2 percent.

The March and April rate hikes end 20 consecutive months that the Monetary Board kept interest rates at historic low levels since July 2009 to counter the negative impact of the global economic crisis on the country.

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Washington, DC, United States (AHN) – Initial jobless claims rose to 429,000 during the week ending April 23, a 25,000 increase from the previous week and the highest rate in three months.

It also marked the second week in a row that first-time unemployment claims were above the 400,000 mark after dipping below that mark for a time and raising hopes the nation was entering a labor sector recovery to match the ongoing economic recovery in the financial services sector.

In more bad news, the less volatile four-week moving average also rose above the key 400,000 mark to 408,500. That was an increase of 9,250 from the previous week’s revised average of 399,250 initial claims, the Department of Labor said.

States with the largest increases in the number of first-time jobless claims for April 16, the latest week for which such data is available, were Florida (+2,753), New Mexico (+680), New Jersey (+490) and Colorado (+481).

The number of people claiming benefits in all unemployment compensation programs for the latest week such data is available was 8,187,232 for the week ending April 9, which marked a decrease of 112,578 from the previous week.

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beverl;y Hills, CA, United States (AHN) – Website MySpace is losing members at a rate of 2 million users in a span of two months.

According to data from technology industry analyst comScore, as of February 2011, the portal had only 63 million users from about 73 million at the start of 2011. Reckoned the past 12 months, MySpace’s hemorrhaging of members is more alarming at 50 million users as the number of users dwindled from 110 million in February 2010.

Because of the loss, despite changes in the website for it to focus on music, MySpace announced plan to reduce its workforce by 50 percent or about 500 employees worldwide.

The decline in popularity of MySpace is attributed to the growing popularity of Facebook that MySpace no longer labels itself as a social networking site, but an entertainment destination. Along with the decline in members is also a dip in value for MySpace.

When News Corp purchased MySpace in 2005, the company was valued at $495 million. Today, it has an estimated value of only $75 million.

In comScore’s June 2010 report, MySpace was not in the top 5 U.S. search engine rankings, which was topped by Google and followed by Yahoo! sites. In the expanded search engine rankings, MySpace was on 20th spot with number of search queries down by 5 percent from May 2010.

For the same period, Facebook – which ranked 17th – registered a 2 percent increase in online searches.

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Pakistan’s central bank kept interest rates unchanged for a second straight meeting, in line with economists’ forecasts, as the inflation rate slowed to a seven-month low.

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South Korea’s unemployment rate rose to a one-year high in February as jobs in farms, hotels, restaurants, and the retail and wholesale sectors declined.

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Ottawa, Ontario, Canada (AHN) – Canadian Finance Minister Jim Flaherty announced Monday that Ottawa has amended three rules governing mortgages to curb rising household debts.

Under the new regulations, the maximum amortization period for government-backed insured mortgages was reduced to 30 years from 35 years. These are for mortgages with loan-to-value ratios of more than 80 percent.

Ottawa also cut the maximum amount that residents could borrow to refinance their mortgages to 85 percent from 90 percent of their homes’ value. The government also withdrew government insurance backing on lines of credit secured by homes.

With the changes, the amortization of an average Canadian resale house sold for $344,551 with an minimum 5 percent down payment of $17,227 would increase the monthly amortization by $110 to $1,555.

Although Canada has less than 1 percent mortgage default rate, Flaherty said the federal government wants to reduce borrowing with the average level of household debts rising to 148 percent of disposable income.

Flaherty said in a statement, “Canada’s well-regulated housing sector has been an important strength that allowed us to avoid the mistakes of other countries and helped protect us from the worst of the recent global recession.”

He added, “The prudent measures announced build on that advantage by encouraging hard-working Canadian families to save by investing in their homes and future.”

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