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Mexico central bank Governor Agustin Carstens will be presented as a candidate for managing director of the International Monetary Fund, the Finance Ministry said in an e-mailed statement today.

The process to choose a new leader at the IMF should be “open, transparent and based on merit,” the ministry said. Finance Minister Ernesto Cordero will present Carstens’ candidacy, the statement said. The government will likely nominate Carstens tomorrow, said Ricardo Ochoa, head of international affairs at the ministry, in a phone interview.

With Carsten’s nomination, Mexico joined Australia, China and other nations in calling for the new managing director of the lender to be chosen because of merit and not the convention that the position should go only to Europeans. Australian Treasurer Wayne Swan said May 22 the position shouldn’t be “limited” to any one nation or continent.

The Washington-based fund plans to complete its search for a managing director by June 30 to replace Dominque Strauss-Kahn who was indicted May 19 in New York on charges including attempted rape. Carstens served as deputy managing director of the fund from 2003 to 2006.

Carstens became central bank governor in January 2010 after Guillermo Ortiz stepped down. Carstens, who has a doctorate in economics from the University of Chicago, served as finance minister starting in 2006, where he led the nation’s response to the global financial crisis. Mexico was the first nation to request a flexible credit line from the IMF, a mechanism to help support economies seeking strong macroeconomic policies.

Voting Power

Mexico leads a group of eight countries with 117,045 votes, or 4.66 percent of the total IMF voting power, according to the multilateral lender’s website faxless pay day loans. The group is the seventh largest, measured by voting power, behind the U.S., Japan, Germany, France, the U.K. and 10 nations led by Belgium.

Carstens, a Chicago Cubs baseball fan, led Mexico’s response to the global financial crisis as finance minister since 2006. As chief economist for the central bank from 1994 to 1999, he co-wrote a paper in which he pushed for market participants to have broader access to central bank data. Under Carstens, the central bank published the minutes of policy meetings for the first time this year.

Flexible Credit

The IMF renewed and boosted Mexico’s flexible credit line to $72 billion in January, replacing the one-year $48 billion facility. Mexico first sought the line in 2009 to bolster confidence in the economy, which contracted the most since 1995 that year. Colombia and Poland were the only other two nations to enter similar agreements with the IMF, which the lender said were reserved for nations with strong economic policies.

The economy grew 5.5 percent last year, the fastest growth in 10 years, and may expand as much as 5 percent this year, Carstens said on May 11. Policy makers boosted their forecast for growth this year without changing their forecast for inflation of 3 percent to 4 percent. Annual inflation slowed to 3.36 in April, near the 5-year low set in March and half that of Brazil. The central bank has a target of 3 percent inflation.

Mexico has been buying as much as $600 million dollars monthly through dollar options since March 2010, boosting foreign reserves rose to a record $125.8 billion this year, according to the central bank.

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Yuan forwards traded at the biggest premium to the spot rate in more than five months, reflecting speculation the central bank will allow faster currency gains to help tame inflation.

More rapid appreciation may be a tool for curbing prices, Wang Yong, a professor at the People’s Bank of China’s training center in the city of Zhengzhou, wrote in a commentary published in today’s Securities Times newspaper. The central bank set the yuan’s reference rate 0.11 percent stronger at 6.5156 per dollar, the highest level since July 2005.

“The frequent record highs in the reference rate are pushing up appreciation bets in the offshore market,” said Liu Dongliang, a Shenzhen-based senior analyst at China Merchants Bank Co., the country’s sixth-largest lender by market value. “There won’t be any one-off move in the foreseeable future, especially when the trade surplus is narrowing.”

Twelve-month non-deliverable forwards rose 0.3 percent to 6.3285 per dollar as of 10:43 a.m. in Hong Kong, 2.9 percent stronger than the onshore exchange rate of 6.5133, according to data compiled by Bloomberg. That’s the largest gain projected since Nov. 10. The currency appreciated 0.1 percent today in Shanghai and earlier touched a 17-year high of 6.5131, according to the China Foreign Exchange Trade System.

Relatively large pressure for yuan gains has affected companies’ export orders, the Ministry of Commerce said on its website today. The country’s import growth may be faster than export growth this year, the ministry said. The world’s second- biggest economy had a $1.02 billion trade deficit in the first three months of this year, the first quarterly shortfall in seven years.

Consumer prices rose 5.4 percent in March from a year earlier, exceeding the government’s 2011 target of 4 percent, according to data released last week.

–Judy Chen. Editors: Sandy Hendry, James Regan

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With rising oil prices and the possibility of a Tory majority, the future is looking brighter for northern Alberta

European Central Bank Executive Board member Juergen Stark said the bank will raise interest rates and withdraw other emergency measures at an appropriate pace.

“The ECB will adjust its policy interest rates and its provision of liquidity at a pace and to a degree commensurate with the evolution of risks to price stability and as appropriate to maintain an orderly and functional monetary policy transmission,” Stark said in a speech in Hong Kong today. “As with the phasing-in of non-standard measures, there are no pre-defined steps between phasing them out and exiting from very low policy interest rates.”

Stark’s comments indicate the Frankfurt-based ECB has embarked on a gradual tightening cycle even though President Jean-Claude Trichet said last week’s rate increase, the first in almost three years, wasn’t necessarily the start of a series. Officials are balancing the need for higher borrowing costs in countries like Germany, whose economy is booming, against the risk that they could exacerbate the sovereign debt crisis afflicting peripheral euro-area nations.

The ECB on April 7 lifted its key rate to 1.25 percent from a record low of 1 percent to stem faster inflation. At the same time, it maintained programs to provide unlimited liquidity to banks and purchase the bonds of debt-strapped governments.

‘More Normal’

These “non-standard monetary policy measures are an extraordinary response to exceptional circumstances” and are “temporary in nature,” Stark said. “A return to a more normal liquidity management and to a more moderate scale of central bank intermediation is warranted to avoid distortions in financial incentives with longer-term adverse consequences for the economy.”

Stark suggested the ECB can keep raising rates while leaving some non-standard measures in place, saying they can “coexist with any interest rate level.”

“The maintenance of price stability over the medium term guides all monetary policy decisions,” he said.

Inflation breached the ECB’s 2 percent limit in December and accelerated to 2.6 percent last month, the fastest pace in more than two years. The ECB aims to keep inflation just below 2 percent.

Policy makers will follow last week’s rate increase with 25 basis-point steps every three months, taking the benchmark to 1.5 percent in July and 1.75 percent in October, according to the median of 20 estimates in the Bloomberg News survey. The pattern will continue in 2012 with increases every quarter, so that the key rate reaches 2.75 percent before the end of next year, the survey shows.

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What had been a little-known home weatherization program has become the latest target for Republican state senators trying to make a point about runaway federal spending.

The senators have proposed slashing $250 million of already approved federal stimulus projects as a trade-off for their agreement to drop their controversial bid to turn down federal money for unemployment assistance.

The leader of the conservative group, Sen. Jim Lembke, R-Lemay, called the stimulus spending “a plethora of different pork barrel projects and pet projects cash till payday advance.” Chief among them: the weatherization program that pays to upgrade homes for low-income Missourians. That millions of dollars in federal funds has been ’sitting there” for two years proved his point that it was unneeded, Lembke said.

But one of the biggest recipients of weatherization money awarded to any local agency in the state

The Dow Jones industrial average closed its best start to the year since 1999 Thursday, rising 6.4 percent in the first three months. The index of 30 large companies gained 742 points in that stretch. Measured against other first quarters, that’s the largest point gain since 1998 and the second best on record.

Stocks ended the day mixed as the price of oil jumped to a 30-month high. Slightly disappointing reports on unemployment claims and factory orders also weighed on the market.

The first-quarter gains were anything but an easy ride. Uprisings in the Arab world, a jump in oil prices along with the earthquake, tsunami and nuclear crisis in Japan led to many deep one-day falls.

“This is a market that has been defined by resilience in the face of uncertainty,” said Andrew Goldberg, a market strategist at JP Morgan Funds.

The Dow Jones industrial average fell 30.88 points, or 0.3 percent, to 12,319.73. That’s just 72 points shy of its Feb. 18 high for the year.

The Standard & Poor’s 500 fell 2.43, or 0.2 percent, to 1,325.83. The Nasdaq composite rose 4.28, or 0.2 percent, to 2,781.07.

The S&P 500 rose 5.4 percent during the first quarter, the Nasdaq 4.8 percent.

The market turned wildly volatile in March. In the third week, the Dow moved by more than 100 points four straight days. On March 16, fears that Japan’s nuclear crisis would get even worse turned all three major indexes negative for the year. The very next day a jump in manufacturing and a drop in unemployment claims helped bring them back payday lenders.

Stocks swung between small gains and losses Thursday as the price of oil surged to settle at $106.72 a barrel. Troops loyal to Libyan leader Moammar Gadhafi retook control of the key oil port of Ras Lanouf from rebel forces. The power shift threatens the quick restart of oil exports promised by a rebel victory.

Oil prices have jumped $20 since the Libyan uprising began in February. Higher oil prices can pinch spending by forcing consumers to pay more for gasoline and could cut into economic growth.

There were also slightly disappointing reports on new unemployment claims and factory orders. The Labor Department said fewer people applied for unemployment benefits last week, signaling that companies may be slowing layoffs. The number of new claims fell by 6,000 to 388,000. Analysts had expected a larger drop.

The news comes a day before the Labor Department’s monthly employment report. The unemployment rate is expected to remain unchanged at 8.9 percent.

Banks in Ireland were also under pressure. The country’s central bank said Thursday that four of its cash-strapped banks need another euro24 billion in coming months to show that they won’t collapse in the face of future crises. Ireland has already put euro46 billion into the country’s banks since 2009. The four banks will need to draw on an emergency credit line from the European Union and the International Monetary Fund.

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First-time claims for jobless benefits probably rose last week from an almost three-year low, a pause in the improvement in the U.S. labor market, economists said before a report today.

Initial applications for unemployment insurance climbed by 8,000 to 376,000 in the period ended March 5, according to the median forecast in a Bloomberg News survey. The gain would be the second in the past eight weeks. It would follow the previous week’s level of 368,000 claims, which were the fewest since May 2008. Separate figures may show a wider trade deficit in January on costlier imported oil.

The rebound in the world’s largest economy has limited firings, paving the way for employers such as Boeing Co. (BA) and Home Depot Inc. (HD) to add jobs and spur household spending. While American companies ship more goods abroad, stronger domestic demand and surging energy prices point to a bigger import bill, curbing the contribution to growth from trade.

Still, the labor market “has improved only slowly,” and it may take “several years” for the unemployment rate to reach a “more normal level,” he said guaranteed high risk personal loans.

While stocks have gained this year amid signs employment is picking up along with the economy, they’ve been restrained by surging oil prices. The Standard & Poor’s 500 Index is down 0.5 percent so far this month.

The tax compromise reached by President Barack Obama and congressional Republicans in December has resulted in bigger paychecks that are helping support demand even as fuel costs rise. Costlier oil, which this week reached a 29-month high in New York, also will lead to higher imports. At the same time, exports of American-made goods, aided by a weaker dollar and expansion in developing economies like China, may help limit growth in the trade deficit.

Bloomberg Survey ============================================================== Trade Initial Cont. Federal Balance Claims Claims Budget $ Blns ,000’s ,000’s $ Blns ============================================================== Date of Release 03/10 03/10 03/10 03/10 Observation Period Jan. 5-Mar 26-Feb Feb. ————————————————————– Median -41.5 376 3750 -225.2 Average -41.4 377 3759 -225.3 High Forecast -39.0 410 3820 -190.0 Low Forecast -46.0 355 3700 -243.6 Number of Participants 74 49 16 26 Previous -40.6 368 3774 -220.9 ————————————————————– 4CAST Ltd. -42.2 383 — -223.0 ABN Amro -41.5 355 — — Action Economics -41.0 390 3820 -223.0 Aletti Gestielle -42.0 380 — — Ameriprise Financial -41.0 370 3720 — Banesto -41.1 — — — Bank of Tokyo- Mitsubishi -41.7 381 — -225.0 Barclays Capital -42.0 380 — -225.0 BBVA -41.0 370 3740 -227.5 BMO Capital Markets -41.7 380 3765 -232.5 BNP Paribas -41.8 380 — -240.5 BofA Merrill Lynch -41.5 375 — -235.0 Briefing.com -41.5 370 3750 -223.0 Capital Economics -41.0 — — — CIBC World Markets -41.0 — — — Citi -41.5 375 3810 -220.0 ClearView Economics -42.0 — — — Commerzbank AG -42.0 360 — — Credit Agricole CIB -41.0 — — — Credit Suisse -41.0 400 — — Daiwa Securities America -42.0 — — -190.0 DekaBank -40.5 — — — Desjardins Group -41.9 385 — — Deutsche Bank Securities -41.0 — — — Deutsche Postbank AG -39.0 — — — First Trust Advisors -42.2 372 — — FTN Financial -42.0 — — — Goldman, Sachs & Co. -41.5 — — -235.0 Helaba -41.5 375 — — Horizon Investments -40.0 — — — HSBC Markets -40.7 370 — — Hugh Johnson Advisors -39.0 — — — Ibersecurities -41.8 — — — IDEAglobal -41.0 380 — -235.0 IHS Global Insight -40.1 — — — Informa Global Markets -41.5 375 3785 -223.0 ING Financial Markets -42.0 365 3700 -243.6 Insight Economics -42.0 395 3750 — J.P. Morgan Chase -42.0 375 — -226.0 Janney Montgomery Scott -41.9 — — — Jefferies & Co. -41.0 375 — -225.0 Landesbank Berlin -46.0 — — — Landesbank BW -41.4 378 — — Manulife Asset Management -41.5 372 3725 — Maria Fiorini Ramirez — 365 — — MF Global -41.5 380 — -230.0 Mizuho Securities -42.0 410 — — Moody’s Analytics -42.4 385 3780 — Morgan Keegan & Co. -41.3 — — — Morgan Stanley & Co. -42.5 370 — -220.0 National Bank Financial -40.5 — — — Natixis -42.2 — — — Nomura Securities Intl. -39.9 — — -192.0 Nord/LB -41.5 370 — — Parthenon Group -40.7 378 — — Pierpont Securities -42.0 373 — -220.0 PineBridge Investments -42.0 388 — — PNC Bank -42.0 — — — Raiffeisenbank International -40.8 — — — Raymond James -41.2 378 — — RBC Capital Markets -41.7 380 — — RBS Securities -40.6 380 — — Scotia Capital -42.0 390 3800 — Societe Generale -39.7 360 — — Standard Chartered -41.5 — — — State Street Global Markets -41.8 376 3756 -225.4 Stone & McCarthy Research -39.7 390 — -230.0 TD Securities -41.5 365 3750 — Thomson Reuters/IFR -41.0 370 3740 -229.0 UBS -42.0 370 — -225.0 University of Maryland -40.9 375 — -235.0 Wells Fargo & Co. -39.4 — — — WestLB AG -41.0 — — — Westpac Banking Co. -41.5 380 — — Wrightson ICAP -41.5 385 3750 — ==============================================================

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Asian stock markets mostly fell Monday, pressured by worries over a slowing global recovery as oil prices rose to their highest level in more than two years after the conflict in Libya escalated.

Japan’s benchmark Nikkei 225 stock average dropped 141.73 points, or 1.3 percent, to 10,551.93. Sentiment in Tokyo was downbeat on growing political uncertainty after Japan’s foreign minister resigned Sunday over illegal political donations, dealing a blow to Prime Minister Naoto Kan’s embattled administration.

Hong Kong’s Hang Seng index was up 0.2 percent to 23,443.57, while the Shanghai Composite index was up 1.1 percent at 2,974.77.

Elsewhere, South Korea’s Kospi shed 0.6 percent to 1,993.62. Australia’s S&P/ASX 200 index declined 1.2 percent to 4,806.20. Shares in Taiwan were lower, but those in New Zealand and Singapore were marginally higher.

Investors were worried that soaring oil prices could stifle global economic growth by increasing transportation and production costs.

Benchmark crude for April delivery was up 75 cents at $105.17 a barrel in electronic trading on the New York Mercantile Exchange. The contract gained $2.51 Friday to settle at $104.42 a barrel, the highest level since September 2008, after fighting in Libya intensified.

Soaring oil prices spooked investors on Wall Street Friday with the Dow Jones industrial average losing 88.32 points, or 0.7 percent, to 12,169.88.

In currencies, the dollar rose to 82.31 yen in Tokyo Monday from 82.27 yen in New York late Friday. The euro slipped to $1.3978 from $1.3984.

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Fighting inflation is China’s top economic priority this year as the government aims to limit the risk of social unrest, Premier Wen Jiabao said in his state-of- the-nation speech.

“We cannot allow price rises to affect the normal lives of low-income people,” Wen said in a report to the annual meeting of the National People’s Congress in Beijing today. “This problem concerns the people’s well-being, bears on overall interests and affects social stability.”

Wen, 68, confirmed targets of 4 percent for full-year inflation and 8 percent for economic growth, as the Communist Party seeks to maintain support for its 61-year rule. In the past two weekends, the government has deployed hundreds of police in Beijing and Shanghai after Internet calls for so- called Jasmine protests, inspired by revolts in the Middle East and North Africa.

“Inflation is a potential trigger point for social discontent,” said Liu Li-Gang, an economist at Australia & New Zealand Banking Group in Hong Kong who formerly worked for the Hong Kong Monetary Authority and the World Bank. The government needs to boost lending and deposit rates by 0.75 percentage point by year-end, as well as raising wages and giving subsidies to the poor, he said.

Land Seizures, Food

Wen identified illegal land seizures, food safety, house- price increases and corruption as top public concerns and said institutional changes are needed to end the excessive concentration of power. The government will “decisively” counter inflation and make it the “top priority in macroeconomic control,” he said.

The budget deficit may be 900 billion yuan ($137 billion), or 2 percent of gross domestic product, 150 billion yuan less than targeted for 2010, Wen said. He confirmed that the nation is maintaining a “proactive” fiscal policy and a “prudent” monetary stance.

The Shanghai Composite Index rose to a four-month high yesterday as investors anticipated moves to boost consumption. The government aims to cut dependence on exports and investment and raise consumer spending, a shift that could help to ease global economic imbalances blamed for the financial crisis.

“Expanding domestic demand is a long-term strategic principle,” Wen said in the report. Subsidies for urban low- income earners and farmers and continued incentives for rural purchases of home appliances may boost spending, he said.

Private Investment

Wen also pledged to encourage private investment, including in infrastructure, public utilities and financial services.

The premier had already disclosed an annual growth target of 7 percent for the five-year plan running through 2015, down from the previous 7.5 percent. Based on 2010 prices, gross domestic product should exceed 55 trillion yuan ($8.37 trillion) by the end of the period, Wen said. The U.S. has a more than $14 trillion economy.

China’s growth goals are routinely surpassed, with the economy expanding an average 11 percent over the past five years, adding jobs and boosting incomes.

Wen read his report to more than 4,000 delegates gathered at the Great Hall of the People, alongside Tiananmen Square, a meeting first held in 1954 to approve government policies. Members of the congress include Zong Qinghou, the billionaire chairman of Hangzhou Wahaha Group and China’s richest man.

Inflation Risks

The world’s second-biggest economy faces heightened inflation and asset-bubble risks and banks may be saddled with more bad loans after a record expansion in credit drove China’s economic recovery no teletrack payday loan.

Consumer prices rose an annual 4.9 percent in January and food prices jumped, even after the central bank increased interest rates and banks’ reserve requirements. Wen pledged a “comprehensive audit” of local-government debt, after a surge in borrowing linked to the stimulus program from late 2008.

To control inflation, the government will manage liquidity, ensure agricultural production and use price controls when needed, Wen said. Officials will curb real-estate speculation and “adjust and improve” property tax policies, he added.

“The main challenge for controlling inflation is the property-price bubble stemming from overly loose monetary conditions relative to asset prices,” economists led by Peng Wensheng at China International Capital Corp. Ltd. said in a March 2 report.

Public Security

On Feb. 27, Wen pledged to punish abuse of power by officials and narrow the wealth gap. His comments coincided with public security operations in Beijing and Shanghai to prevent protests after an open letter called for “jasmine” rallies, named after the January uprising in Tunisia that overthrew President Zine El Abidine Ben Ali.

China’s leaders are seeking to maintain stability as the world’s most populous nation shifts from a predominantly rural to mostly urban society. During the five years through 2015, the level of urbanization will rise to 51.5 percent from 47.5 percent, Wen’s report said.

“Private companies will have huge business opportunities during the process,” Wang Jianlin, the billionaire chairman of property developer Dalian Wanda Group, said at the congress.

The divide between rich and poor is at levels not seen outside of Africa, Credit Suisse Group AG said in an August report. The average full-year income in the countryside last year was 5,919 yuan ($900), according to the statistics bureau.

Spending Power

The nation’s Gini coefficient, an income-distribution gauge used by economists, has climbed to near 0.5 from less than 0.3 a quarter century ago, according to Li Shi, professor of economics, School of Economics and Business at Beijing Normal University. The measure ranges from 0 to 1, and the 0.4 mark is used as a predictor by analysts for social unrest.

Government moves to boost incomes and spending power may include raising the threshold for income tax from 2,000 yuan per month, a plan already approved by the State Council.

A stronger Chinese currency would also bolster consumption, the U.S. government says. Wen’s report said the government will improve “the exchange-rate mechanism,” while Yi Gang, the head of the State Administration of Foreign Exchange, told reporters at today’s meeting that the yuan’s rate “has never been closer to equilibrium.”

Chinese companies can accept annual yuan appreciation of 3 percent to 5 percent, Bank of China Ltd. President Li Lihui said at the meeting. The yuan closed at 6.5686 per dollar on March 4. Li also said lending growth will cool this year because of government constraints.

–Zhang Dingmin, Zheng Lifei, Michael Forsythe, Sophie Leung, Kevin Hamlin, Michael Wei, Eva Woo. Editors: Paul Panckhurst, Peter Hirschberg.

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