THE NEWS WRAP: Small firms set to benefit from surge in bank business lending

Small firms are set to benefit from a surge in bank business lending this year, according to analysts.

The banks are expected to increase lending to businesses by 3.5% over the next three quarters, driven by the construction, wholesale, retail and transport sectors.

A Morgan Stanley report predicts that NAB will grow its business loans by 7%, ANZ will increase its lending by 5%, Westpac by 3% and Commonwealth Bank by 2%.

ACCC calls for price fixing crackdown

The Australian Competition and Consumer Commission (ACCC) has urged the Government to hand it new powers to clampdown on price fixing by the major banks.

The corporate watchdog’s chairman Graeme Samuel told a senate inquiry that it is currently very difficult to prove price collusion.

US struggling to prove Assange link

US authorities are reportedly struggling to find a connection between Julian Assange and a US army private who is suspected of handing secret documents onto the Wikileaks founder.

According to NBC News, Pentagon investigators have so far been unable to link Assange to private Bradley Manning, who is accused of passing on thousands of secret documents. A failure to establish a connection could remove the threat of legal action by US courts against Assange.

US budget deficit increases

The US budget deficit will rise to 2009 recession levels this year, soaring to hit $1.48 trillion, or 9.8% of economic output, the Congressional Budget Office has reported.

A new stimulus package agreed by President Obama triggered the budget blow out. The revelation follows Obama’s State of the Union speech, in which he called for huge US investment in clean energy technology and IT in order to raise the US’ competitiveness in the future.

Overnight

The Down Jones industrial average climbed above 12,000 points for the first time since 2008, buoyed by signs of economic recovery in the US.

Meanwhile, the Australian dollar edged down slight, to 99.41 US cents.