Economy

Consumer Prices in U.S. Rose 0.1% Last Year, Smallest Increase Since 1954 The cost of living in the U.S. fell in December as the recession deepened, capping the smallest annual gain in a half century.

U.S. Industrial Production Falls 2%, Double Estimates, Led by Automobiles U.S. industrial production fell twice as much as forecast in December as companies pulled back to try to weather the global economic slowdown. Auto output fell to the lowest in more than a quarter century.

Spain Faces Its Deepest Recession in Half a Century, Finance Minister Says Spain faces its deepest recession in half a century, Finance Minister Pedro Solbes said.

Consumer Confidence in U.S. Unexpectedly Rises as Gasoline Prices Retreat Confidence among U.S. consumers unexpectedly rose in January, helped by a retreat in gasoline prices and growing expectations that President-elect Barack Obama may keep the economy from getting worse.

European Exports Drop the Most in Eight Years as Economic Downturn Deepens European exports declined at the fastest pace in more than eight years in November as the global economic downturn throttled demand for the region’s cars, trucks and planes.

U.S. Regulators Pushed Toward `Dramatic' Steps to Bolster Banking System Renewed questions about U.S. banks’ viability are pushing regulators toward a new plan that would remove toxic assets from bank balance sheets, in what may become the biggest effort yet to unfreeze lending.

Mexico Lowers Benchmark Rate to 7.75% in First Cut in Almost Three Years Mexico’s central bank reduced its benchmark interest rate for the first time in almost three years to bolster a slumping economy hurt by the U.S. recession.

Trichet Vision Unravels as Investors Demand Higher Rates From Spain, Italy European Central Bank President Jean-Claude Trichet’s vision of economies converging behind the shield of a shared currency may be unraveling.

Gieve Says Full Impact of U.K. Interest-Rate Cuts, Measures Not Yet Felt Bank of England Deputy Governor John Gieve said that interest-rate reductions, tax cuts and bank rescues have yet to take their full effect on the British economy as the recession deepens.

Putin Reaps Plaudits at Home for Freezing Ukraine, EU Through Gas Standoff Russian Prime Minister Vladimir Putin’s standoff with Ukraine over supplies of natural gas may have angered European Union leaders and denied heat to millions; at home, it’s winning him plaudits.

French Business Confidence Index Falls to 21 Year Low: Table of the Day Following is a summary of the December business sentiment survey from the Bank of France in Paris:

Fed Watch

Geithner's Senate Confirmation Hearing Delayed After Republican Objections Senate Republicans moved yesterday to delay Timothy Geithner’s confirmation as Treasury secretary, pushing President-elect Barack Obama to defend his nominee’s “embarrassing” mistake of underpaying his taxes.

Fed's Evans Joins Bullard, Plosser in Supporting Target for U.S. Inflation Federal Reserve Bank of Chicago President Charles Evans called for the adoption of an inflation target to prevent expectations for prices from falling too far amid the credit crisis and U.S. recession.

Daniel Tarullo, Candidate for Fed, Calls for Overhaul of Financial Rules Federal Reserve Board nominee Daniel Tarullo, an attorney who advised President-elect Barack Obama’s campaign on economic policy, said U.S. financial regulation needs “sensible changes” to reduce the risk of future crises.

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