Best Investment

Canadians poured more than $2.5 billion into mutual funds in April traditionally a slow time for the fund industry.

The Investment Funds Institute of Canada (IFIC) confirmed Tuesday that net new sales last month sales minus redemptions were $2.55 billion.

That’s almost five times the $537 million in net sales recorded in April 2006.

“Historically, there tends to be an industry wide slowdown in sales between March and April when investors take a breather after the RRSP season. However, this April we’ve seen sales that are $2 billion higher than the same period in either of the last two years,” IFIC vice president Pat Dunwoody said in a statement.

About 80 per cent of the net sales came in Canadian balanced funds, global balanced funds and foreign equity funds. All three categories saw about$1 billion in net sales.

On the flip side, Canadians were busy selling domestic equity fundsin April. Net redemptions that month came in at $620 million, even thoughthe TSX gained about two per cent.

Year-to-date, Canadians havepoured almost $20 billion into mutual funds, as this year’s RRSP seasonwas the best for industry sales in nine years.

LONDON (Thomson Financial) - The pound came off 26-year highs but stayed well bid above the 2 dollar level as the flow of strong UK data proved relentless.

Coming on the heels of a record surge in inflation, wage growth hit a high not seen in nearly three years, suggesting that the outlook for inflation may worsen over the coming months.

Average earnings growth including bonuses jumped to 4.6 pct in the three-month period from the year earlier, after a 4.2 pct rise in January. The figure is cause for concern at the Bank of England as it has vaulted above the 4.5 pct level thought to stoke inflationary pressures.

After the news, the pound jumped to 2.013 usd, a new multi-year high, before slipping back. The data coincided with the release of the minutes to the Monetary Policy Committee’s April meeting, where the MPC opted to leave interest rates on hold at 5.25 pct.

The minutes showed a 7-2 vote to hold in April but essentially confirmed market expectations that the Bank of England will hike rates in May.

In any event, the minutes have been overtaken by events, with yesterday’s surprise jump in key CPI inflation to 3.1 pct already making a May hike all but certain.

The spate of strong data has even led to talk of a hefty half-point rate hike, to 5.75 pct in May, BNP Paribas analysts said.

Fuelled by such speculation, the pound was well underpinned, with BNP Paribas analysts suggesting that sterling’s rise above 2.011 usd may open the way for further gains up to 2.037 usd.

But some analysts believe markets may be a running ahead too quickly.

Daniel Katzive at UBS noted that UK data may slow sufficiently to avoid a second tightening later in the year.

The pound was broadly flat against other major currencies, demonstrating that at least part of its strength is coming from the dollar’s overall weakness.

The US currency remained weak across the board after soft inflation data yesterday. The dollar sank to a new two-year low against the euro of 1.3614 usd.

“The dollar trades heavily with a number of currencies exceeding their December 2004 highs against it,” said analysts at HBOS.

“The fact that a leading group of currencies has already broken higher is encouraging for the prospects of the current dollar downtrend extending,” they said.

Elsewhere, the Kiwi dollar was a major winner, after a sharp rise in domestically generated inflation in New Zealand.

In the final quarter of 2006, CPI rose by 0.5 pct from the previous quarter, a little less than predicted. Focus was on domestically generated inflation which surged by 1.2 pct during the same period.

Interest rates in New Zealand are predicted to rise as a result, to 7.75 pct from 7.50 pct at present when the Reserve Bank of New Zealand meets on April 26.

If rates do rise, the Kiwi dollar will become even more attractive as the destination for carry trades funded in low yielding places like Japan.

The yen, meanwhile, stayed on the back foot although off recent lows.

“Intriguingly, some of the key carry trades are looking a bit tired over the past 24 hours, despite continued solid performance from global equity markets and stability in credit markets,” said Daniel Katzive at UBS.

He pointed out however that carry trades are likely to continue thriving over the medium term.

As the G7 is on a hiatus until its September meeting — finance ministers meet in May, but without central bankers — the risk of a sudden drop in risk appetite is reduced slightly, he added.

The recently concluded G7 meeting made no specific mention of the yen’s weakness, helping solidify carry trades even further.

London 1251 BST London 0926 GMT

US dollar

yen 118.33 down from 118.65

sfr 1.2049 up from 1.2034

Euro

usd 1.3575 down from 1.3608

stg 0.6769 up from 0.6761

yen 160.69 down from 161.47

sfr 1.6361 down from 1.6378

Sterling

usd 2.0057 down from 2.0119

yen 237.48 down from 238.75

sfr 2.4172 down from 2.4214

Australian dollar

usd 0.8331 down from 0.8371

stg 0.4152 down from 0.4159

yen 98.65 down from 99.37

New Zealand dollar

usd 0.7399 down from 0.7460

sivakumar.sithraputhran@thomson.com

rar/bsd

COPYRIGHT

Copyright AFX News Limited 2007. All rights reserved.

The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News.

For 15 months, detectives investigating the disappearance of businessman Andrew Ramsay have been baffled by what became of him.

The middle-aged father of two was bundled into a car near his home in Glasgow in February last year by two men claiming to be police officers and has never been seen since.

There were few clues, although the lack of any ransom demand led them to believe his abduction may have been some kind of vendetta. Another theory put forward was that he staged his own disappearance.

Yesterday, police revealed that they had found his skull, putting an end to any hope they had of finding him alive.

His head was caught in the nets of fishermen off the Isle of Cumbrae in the Firth of Clyde on April 5 and handed over to police. Forensic tests have now confirmed the skull to be that of Mr Ramsay.

Police were able to say it had been in the water for some months and that there was no evidence, at this stage, to suggest he had met a violent end. It was unlikely that a body would remain intact after such a long time in the water, they said.

But the scant remains of the accountant have offered them few clues as to what happened to him or why.

Detective Superintendent William Prendergast said that, until now, he had never given up hope that Mr Ramsay would be found safe and well.

He was “deeply saddened” to have to inform Mr Ramsay’s family of the news, he said.

Mr Prendergast said the investigation would be stepped up once more, but that it would remain an abduction and not a murder inquiry.

He said: “This is still a mystery. There are still questions to be answered here.”

The skull will undergo further forensic tests. No further searches will be carried out, as the remains were found in open water.

As details of twice-married Mr Ramsay’s past emerged after his disappearance, so speculation increased as to what might have happened.

It turned out he had been interviewed by HM Customs as part of a probe into money-laundering at a company which once employed him and there were reports that he was due to appear in a high court case as a witness in a fraud trail.

Rumours of the reasons for his abduction intensified when his former girlfriend, the Belgian model and singer Marijke Vannut, was quoted as saying that he “owed a lot of people a lot of money” and that, when they were together, he was always looking over his shoulder.

Mr Ramsay, who was going through a divorce when he was abducted, had worked in Saudi Arabia, Hong Kong and Europe, where he lived in Belgium.

Mr Prendergast once described him as a “man who knew his way about the avenues of life”.

He had a number of failed companies, including Golden Miles, of which he was a director and which he operated out of the same property as a well-known Glasgow brothel.

Yesterday, police spoke out to deny reports that Mr Ramsay had been due to appear as a witness and added that he was not known to them before his abduction.

Mr Prendergast said: “Andrew had been interviewed on several occasions by officers from HM Revenue and Customs. There was never any trial set in relation to those interviews.

“As to whether that has anything to do with his disappearance or not, there’s no evidence to suggest that.”

He added that Mr Ramsay had “no criminality in his history” and had been well liked.

“He was good in conversation; he could come into a room and join into company,” Mr Prendergast said.

“So with this kind of outward personality, we were hoping that we would trace Andrew.”

Police now say that, aside from knowing that he is dead, they are no further forward in the investigation.

Mr Ramsay was taken on the street on February 22 as he walked to his home in Cardonald from the pub with his girlfriend, Beverly Sinclair.

As they arrived, two smartly dressed men, purporting to be police officers, told him he was under arrest and took him away in a dark-coloured car.

Despite a Crimewatch appeal, there have been no witnesses and no confirmed sightings.

The hunt will continue for the two men who abducted Mr Ramsay.

BRUSSELS (AFX) - European Central Bank president Jean-Claude Trichet said the bank’s monetary policy must be credible in ensuring price stability.

“The decisive contribution the ECB’s single monetary policy makes to the smooth functioning of economic and monetary union is to maintain price stability — and be credible in the deliver in the future — in the euro area as a whole,” Trichet said in a speech at the European Parliament.

EU economic and monetary affairs commissioner Joaquin Almunia said that despite the ECB’s monetary tightening over the past year “lending conditions remain fairly favourable”.

The ECB’s governing council is widely expected to raise interest rates further next Thursday, citing the need to control inflation.

In figures published today, euro zone inflation for January eased to 1.8 pct from 1.9 pct in December. This tallies with the ECB’s inflation target of below or close to 2.0 pct.

victoria.main@afxnews.com

vm/am

COPYRIGHT

Copyright AFX News Limited 2007. All rights reserved.

The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News.

AFX News and AFX Financial News Logo are registered trademarks of AFX News Limited

For more information and to contact AFX: www.afxnews.com and www.afxpress.com

Boston Scientific Profit Falls 64 Pct. Boston Scientific Profit Drops on Guidant Costs, Sagging Stent Sales By MARK JEWELL The Associated Press

BOSTON - Downturns in two key heart device markets as well as a $27 billion acquisition continue to weigh on Boston Scientific Corp., whose first-quarter profit fell 64 percent.

The Natick-based medical device maker’s net income for the January-March period was $120 million, or 8 cents per share, compared with a profit of $332 million, or 40 cents per share, in the same period a year ago.

The per-share profit in the latest period was hurt because the company now has 1.5 billion outstanding shares as a result of last spring’s acquisition of Guidant Corp., compared with 830 million a year ago.

Boston Scientific said Monday that net sales rose 26 percent to $2.09 billion from $1.62 billion in the year-ago period a result boosted in part by the addition of Guidant’s implantable defibrillators and pacemakers to diversify a Boston Scientific product portfolio that had been overly dependent on heart stents to prop open coronary arteries.

That result narrowly beat the consensus estimate of analysts surveyed by Thomson Financial, who expected sales of $2.08 billion in the latest quarter.

Boston Scientific recorded an expense of $149 million, or 10 cents per share, largely from amortization costs tied to the Guidant deal. The profit was cut a further $26 million, or 2 cents per share, from other special charges, mostly from Guidant.

Excluding such one-time items in both comparable periods, Boston Scientific said its first-quarter profit was $295 million, or 20 cents per share, down from $415 million, or 50 cents per share, in the year-ago period.

Boston Scientific reported earnings after its shares closed up 11 cents, or nearly 0.7 percent, at $16.09 on the New York Stock Exchange. The shares fell 42 cents, or 2.6 percent, to $15.67 in after-hours trading.

First-quarter sales of Boston Scientific’s Taxus drug-coated stent fell 26 percent to $468 million from $633 million a year ago. Drug-coated stent sales have fallen off amid concerns that the devices may put patients at slightly higher risk for blood clots than older bare-metal stents.

A study released in March created more trouble for stent makers by questioning whether the tiny mesh-metal devices are more effective than less-costly drug therapy at treating patients with clogged coronary arteries who don’t face imminent risk of heart attack.

Taxus had accounted for about 40 percent of Boston Scientific’s overall revenue before the company acquired Guidant.

Jim Tobin, Boston Scientific’s president and chief executive, told analysts in a conference call that the company is going through “a rough patch” in the stent market. But he said recent erosion in the market is easing.

Sales of defibrillators and pacemakers fell about 4 percent in the first quarter to $539 million from $562 million. Sales of those devices have recently been hurt by a series of product recalls and safety warnings involving Guidant products, which helped drive Boston Scientific’s stock price down about 30 percent since the deal was completed a year ago.

Despite the problems, Tobin said the company has made progress on several fronts since acquiring Guidant in improving efficiency and quality control. For example, the company said last week that regulators have lifted a warning about quality-control problems at a Minnesota plant that makes defibrillators and pacemakers, enabling Boston Scientific to resume seeking approval for new heart rhythm devices.

“Where we are today at one year is where I originally thought we’d be at two years,” Tobin said.