Americans increased their borrowing at a 2.4 percent annual rate in May, significantly slower than in April, as a big jump in credit card borrowing was not enough to offset a slowdown in the growth of auto loans, the Federal Reserve reported Monday. The Fed said May’s increase followed a huge 5.2 percent rise in April. The slowdown occurred because of weakness in auto loans, which offset the jump in credit card borrowing. Economists believe that the economy is slowing to a more moderate pace as consumers, faced with soaring gasoline prices, cut back their spending in other areas.
The European Union’s battle against Microsoft Corp. is heating up as regulators prepare to fine the company for flouting a 2004 antitrust ruling that said it deliberately tried to cripple rivals. There was no word Monday on how much the European Commission would demand from the world’s largest software company as a penalty, but it has threatened to levy up to 2 million euros ($2.55 million) a day – backdated to Dec. 15.
Eliminating fancy paint jobs on the covers of 787 engines could save airlines that fly the new jet as much as 30,000 gallons of fuel per year, the Boeing Co. said Monday. As a result, Boeing has decided to paint all 787 nacelles with a standard single layer of paint, the company said. Boeing chose gray, because it complements the metallic appearance of the air intake. The tiny edge where one layer of paint transitions to another can cause turbulence in the air flowing over the surface of the nacelles, the company said. That creates extra drag. Eliminating the paint details reduces the turbulence.
Aluminum producer Alcoa Inc. on Monday said second-quarter profit ballooned 62 percent as higher aluminum prices and strong demand from the aerospace and construction industries boosted results. Net income surged to $744 million, or 85 cents per share, from $460 million, or 52 cents per share, a year ago. The recent results include charges of $35 million, or 4 cents per share, related to the ratification of a U.S. labor contract and the costs of preparing for a potential work stoppage during the quarter.
Cosmetics maker Revlon Inc. on Monday forecast a wider loss for the second quarter, hurt in part by a $40 million shortfall from its poor performing Vital Radiance makeup line aimed at women 50 and older. However, the company maintained its 2006 outlook and its shares rose 1 cent to close at $1.31 on the New York Stock Exchange, still hovering at the low end of a 52-week range of $1.13 to $4.29. The company, controlled by financier Ronald Perelman, said it expects to lose $95 million, compared with $35.8 million in the second quarter of last year and a loss of $58.2 million in the first quarter.
From Herald news services
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