BHP signals caution over global recovery

The Anglo-Australian mining group, BHP Billiton, has said it remains cautious over a sustained globa

The global miner had held off from a share buyback after reporting a weak first-half profit.

BHP's July-December profit, however, was 24 per cent stronger than the first half of 2009, prompting the company to raise its dividend. This helped it increase its share price by about 3 per cent.

BHP has warned that the pace of monetary tightening and the rate of loan growth for commodity-intensive sectors in China, its biggest customer, would be critical, and that it was wary about the speed and strength of recovery in developed economies.

The company said it does not expect China to stop lending, although reduced credit liquidity in key segments of the commodity market could have an impact on prices.

BHP's net profits rose to $6.14bn in December, while profits exceeded analysts' forecasts at $5.7bn.