Egypt says will not need IMF, World Bank funds

Egypt will not borrow from the World Bank and International Monetary Fund after revising its budget and cutting the forecast deficit, even though a loan had been agreed, Finance Minister Samir Radwan said .

The 2011/12 deficit in the first draft budget was forecast at 11 percent of gross domestic product, but was revised to 8.6 percent because of a national dialogue and the ruling army council's concerns about debt levels, the minister told .

"So we do not need to go at this stage to the Bank and the Fund," Radwan said, adding Egypt, which had borrowed from the IMF under ousted president Hosni Mubarak, still had the "best relations" with the two US-based institutions.

Despite the budget revisions, the government said it still expected growth of 3.0-3.5 percent, in line with previous forecasts, which some economists said could prove optimistic.

Egypt this month agreed on a $3-billion (1.9 billion pounds), 12-month standby loan facility from the IMF, which Cairo had said came with more lenient terms than usually associated with such lending.

The IMF and World Bank had been among a range of foreign countries and bodies to offer funds to Egypt to help cover a big budget shortfall after the economy was plunged into turmoil by the mass protests that drove Mubarak from office on February 11.

Egypt's cabinet had approved on June 1 a budget for 2011/12 that increased spending by a quarter to create jobs and help the poor. That was revised in a new draft announced on Wednesday that included raising income tax and reducing fuel subsidies.

Gulf Arab states are among those who offered support.

Radwan said Qatar had provided $500 million for budgetary support in the past week. "That is a gift," he said, when asked if there were any conditions attached to the Qatari cash.

He said Saudi Arabia had earlier offered a similar amount.

The minister said the first draft of the budget, which forecast a deficit of about 170 billion Egyptian pounds, was discussed with activists, writers, the business community, trade unions and non-government organisations.

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Clinton in talks about possible move to World Bank

Secretary of State Hillary Clinton is seeking to become president of the World Bank, according to a report.

Clinton has been in discussions with the White House about leaving her job next year in order to become head of the World Bank.

U.S. Secretary of State Hillary Clinton speaks during a news conference after the third contact group meeting on Libya, at the Emirates Palace in Abu Dhabi June 9, 2011. Clinton said on Thursday talks were under way with people close to Muammar Gaddafi and there was "the potential" for a transition of power in Libya.

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The latest US business and financial news as well as issues and events Sample

The former first lady is already one of the most influential leaders in President Barack Obama's cabinet. She also competed with him for the Democratic presidential nomination in 2007 and 2008.

She has publicly said that she did not plan to stay on at the State Department for more than four years - a post she has held since early 2009.

Associates now say she has her eye on having the World Bank job, should the Bank's current president, Robert Zoellick, leave at the end of his term in the middle of 2012.

"Hillary Clinton wants the job," said one source who knows the secretary well.

A second source concurred with the first. And a third said Obama has expressed his support of the change in role.

It is not known if Obama will formally agree to nominate Clinton for the post, which would require approval by the 187 member countries of the World Bank. The White House declined to comment.

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Australian Stock Market Report

 the us employment trends index fell from a downwardly-revised reading of 100.1 in April (previously 100.5) to 99.7 in May.

The broader measure of European shares fell for a fourth straight day on Monday on continued concerns about the health of the global economy. There was also an element of caution ahead of the European Central Bank meeting on Thursday. But mining shares rose with BHP Billiton up 0.9pct in London trade and Rio Tinto up 1.0pct. The FTSEurofirst index fell by 0.6pct but while the German Dax was down by 0.3pct, the UK FTSE gained 0.1pct.



US sharemarkets fell again on Monday. Investors continue to fret about the softening economy. And airline stocks fell after global industry body, IATA, halved its profit expectations for 2011. Shares in Delta Airlines lost 3pct. The Dow Jones fell by 61pts or 0.5pct with the S&P 500 down by 1.1pct and the Nasdaq lost 30pts or 1.1pct.

US treasury prices ended little-changed on Monday. There was no major economic data to provide guidance and traders were not keen to take positions ahead of auctions later in the week. Treasury will sell $32 billion of 3-year notes on Tuesday, $21 billion of 10-year notes on Wednesday and $13 billion of 30-year notes on Thursday. US 2yr yields were flat at 0.429pct and US 10yr yields rose 1pt to 3.00pct.

The US dollar clawed back some of its recent losses against major currencies in European and US trade on Monday. The Euro eased from highs near US$1.4655 to US$1.4560, before ending US trade near US$1.4670. The Aussie dollar eased from highs near US107.65c to near US106.90c before ending US trade near US107.05c. And the Japanese yen held between 79.95 yen per US dollar and JPY80.35, ending US trade near JPY80.15.

Crude oil prices fell on Monday in choppy trade on expectations that OPEC oil ministers will raise production quotas at their meeting on Wednesday. On-going instability in the Middle East and North Africa limited losses. The Nymex crude oil contract fell by US$1.21 or 1.2pct to US$99.01 a barrel after trading from US$98.64 to US$100.68 a barrel. And London Brent crude fell by US$1.36 to US$114.48 a barrel.

Base metal prices were mixed on the London Metal Exchange on Monday. The tin price fell 1.5pct and nickel lost 0.8pct but other metals rose 0.4-0.9pct except lead which gained 2.7pct. And the gold price also edged closer to record highs on Monday with Comex gold futures up by US$4.80 an ounce to US$1,547.20.

Ahead: In Australia, the Reserve Bank Board meets to decide interest rate settings. In the US, the Federal Reserve chief Ben Bernanke is expected to deliver a speech. Data on consumer credit and weekly chain store sales are also due.

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