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Morning briefing: New sanctions for North Korea, international banking activity up

By Ariana Eunjung Cha
Here's what happened overnight in Asia and Europe:

*Secretary of State Hillary Clinton said the U.S. plans new sanctions against North Korea in response to the sinking of a South Korean warship in March. The measures would be targeted at individuals in Kim Jong Il's regime and banks that aid in trade of arms and luxury goods that are banned under earlier United Nations measures. Clinton made the remarks in Seoul after a meeting between Clinton, Defense Secretary Robert Gates and their South Korean counterparts.

*Minutes of the Bank of England's most recent meeting showed that policymakers considered expanding stimulus measures earlier this month as the economic outlook "deteriorated a little" but decided to keep interest rates stable. The Monetary Policy Committee voted 7-1 to keep the benchmark rate at 0.5 percent. The committee said it was "too early" to assess the government's budget cuts for inflation, according to minutes of the July 8 gathering that were released in London on Wednesday.

*China's official official Xinhua news agency reports that the People's Bank of China does not believe there's any basis for large fluctuations in the value of the yuan and that its current value is "not too far" from its equilibrium level.

*The yen rose against the dollar and euro, as investors concerned about the stalling U.S. recovery and the stability of European banks sought refuge in Japan's currency.

*International banking activity rose for the first time since September 2008. Lending and other activity rose by 2 percent, or $700 billion, in the first quarter of this year, with about half of the increase coming in external claims accounted for by banks in the U.K. and U.S., the Basel, Switzerland-based Bank for International Settlements said.

*Aircraft orders have hit $25 billion at the Farnborough International Airshow so far this week, indicating a rapid recovery in the commercial sector for airplane sales even as many governments cut back on defense purchases. The top buyer has been Air Lease Corp., which purchased 115 planes worth $8.6 billion from Boeing, Airbus and a French-Italian maker of regional turboprops.

For more of the day's economic and domestic policy news, check out Ezra Klein's Wonkbook.

By Ariana Eunjung Cha  |  July 21, 2010; 7:58 AM ET
 
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