BERLIN: Federal Reserve Chairman Ben S. Bernanke said Tuesday that a global “savings glut” has helped keep interest rates low, but he warned that major trade imbalances between emerging and industrial nations may prove “counterproductive” to the global economy over time.

In a largely academic speech prepared for delivery to the German Bundesbank, Bernanke said the recovery of domestic demand growth in Europe, Japan, and other parts of the industrial world had apparently fueled an increase in savings, leading to a mild increase in global real interest rates.

“My reading of recent developments is that although some of the details have changed, the fundamental elements of the global saving glut remain in place,” he said. “Most important, the emerging-market countries and oil producers remain large net suppliers of financial capital to global markets.”

Bernanke, who met with Chancellor Angela Merkel earlier in the day to discuss the U.S. mortgage market crisis and the need for greater financial market transparency, made no mention of current economic or market conditions in his prepared remarks.

The Fed is expected to consider reducing the federal funds target rate at its meeting on Sept 19, from 5.25 percent, amid mounting signs the U.S. economy may slow as the credit crunch that roiled global markets tightens.

Bernanke, in his prepared remarks, focused on external imbalances which he said had widened over the last three years, and urged that the United States work with other countries to mend the jigsaw pattern to contribute to greater economic stability.

To be sure, not everyone agrees these imbalances raise significant risks to the global economy.

For example, the U.S. deficit, although worrisome, also largely reflect the attractiveness of both the U.S. economy overall and the depth, liquidity, and legal safeguards associated with its capital markets, Bernanke said.

Current account imbalances also mitigate the risk of recession, he noted, citing the European economy, which benefited from running trade surpluses during a period of sluggish growth, and is seeing a decline now that the economy is has recovered.

On Tuesday, the European Commission reduced its forecast for growth among the 13 countries that use the euro as a result of recent turmoil in financial markets, and raised its forecast for inflation.

Last week, the European Central Bank agreed to keep interest rates unchanged instead of lifting them as previously planned. President Jean Claude Trichet recently cited the credit crunch and concerns that the U.S. economy may slow as factors that may in turn affect the mending European economy.

Bernanke said the U.S. current account deficit was “certainly not sustainable at its current level,” but U.S.liabilities to foreigners were also not a burden on the American economy.

“All that said,” Bernanke said, “the current pattern of external imbalances Д the export of capital from the developing countries to the industrial economies, particularly the United States Д may prove counterproductive over the longer term.”

RETAIL

Harry Potter lifts Barnes & Noble

The bookseller said its Q2 earnings fell 50% to 12 cents a share ex items, matching estimates. Barnes & Noble’s () revenue climbed 8% to $1.24 bil, topping expectations. It cited better-than-expected sales for the 7th and final installment of the Harry Potter series. Same-store sales grew 4.4%. It forecast a 6-10 cent loss in Q3, better than views. Shares rose 2.6% to 35.82.

Children’s Place Q2 loss widens

The apparel retailer, which operates the Children’s Place () and Disney Store chains, said its preliminary Q2 net loss nearly doubled to $27.1 mil. Sales increased 7% to $424.3 mil, above views, but same-store sales dipped 1%. Children’s Place also said it missed its deadline to remodel several Disney () stores as required under a contract with the entertainment giant. As a result, Disney could void their agreement and pull its product license. Children’s Place tumbled 17% to 27.43.

Bon-Ton misses, lowers outlook

The department store recorded a loss of 91 cents a share in Q2 earnings, less than the $1.20 a share it lost last year, but worse than the 79 cent loss expected. Sales dipped 5% to $730.7 mil, as same-store sales also fell 5%. Bon-Ton () blamed a challenging retail environment and the elimination of liquidation events it offered a year ago. It cut its ‘07 profit outlook to $2.75-$2.90 a share, down from $3.10-$3.30, but above views of $2.69. It fell 4.7% to 24.32.

Cato Corp., () a women’s clothing retailer, said Q2 EPS rose 3% to 39 cents, beating views by 3 cents. Revenue grew 2% to $222 mil, while same-store sales fell 1%. It dipped 0.3% to 20.74.

Buckle, () a casual apparel and footwear retailer, said Q2 EPS rose 73% to 38 cents a share, beating views by 6 cents. Revenue grew 21% to $124.3 mil. Same-store sales grew 10.1%. It rose 0.3% to 35.27.

Casual Male Retail Group, () a men’s clothing retailer, said Q2 profit slid 22% to 7 cents a share ex items, 3 cents under views. Sales rose 2% to $114.2 mil.

TELECOM

China Unicom lifts sales, clients

The Chinese cell phone carrier said its first-half net profit rose 35% to $497 mil ex items. Revenue increased 5% to $6.5 bil. It had 151.6 mil cellular subscribers as of June 30, up nearly 7% from 2006. It issued $1 bil in convertible bonds to SK Telecom last year. SK Telecom said it is acquiring a 6.61% stake in China Unicom () by converting the bonds into shares, part of efforts to expand in the fast-growing Chinese cellular market. China Unicom rose 1.8% to 17.15.

TECHNOLOGY

Hackers strip data from Monster

The job-seeker Web site was notified that one of its servers had been compromised and hackers had stolen data from more than 1 mil resumes held in its database. Using the personal data found in a resume, hackers develop more sophisticated cons to trick unsuspecting Monster () customers into turning over additional personal data, such as Social Security numbers. Security firm Symantec () first spotted the stolen data on a server in Ukraine. Monster fell 1.2% to 33.68.

Limelight Networks, () a provider of media delivering services, signed a contract with Microsoft to improve performance, scalability and reliability of its content. The company will cross-license technologies with the software giant. Terms of the deal were not disclosed. Shares surged 5% to 8.90.

Advanced Micro Devices, () the No. 2 PC chipmaker, said top sales executive Henri Richard is quitting. AMD’s global sales and marketing team will now report directly to CEO Hector Ruiz. Shares edged up 0.4% to 12.06.

Microsoft () said mobile phone maker Nokia () will carry the Windows Live suite of Web-based services on its handsets. Microsoft, Google () and Yahoo () are engaged in a highly competitive battle for space on mobile devices. Microsoft edged up 0.3% to 28.30.

SERVICES

Sotheby’s boosts stake in sales

The auction house said it will match a rival’s fee increase, indicating a potentially robust fall auction supply. The increased charge will be on smaller-ticket auctions starting Sept. 1. Sotheby’s () new buyer’s premium is 25% on items up to $20,000, up from 20%. The buyer’s fee will remain at 20%. It also said its outstanding auction guarantees have jumped to $378 million, from the previously reported total of $274.9 million on Aug. 7. Shares climbed 4% to 42.68.

MACHINERY

Joy Global up on future growth

The mining equipment company rose after UBS upgraded the company’s rating to buy from neutral and said the company’s current level of original equipment sales adds about $700 mil a year to its $10 bil original equipment base. The brokerage also said Joy Global’s () current level of original equipment shipments will drive a larger installed base and higher aftermarket sales. Shares rose 4.8% to 47.15.

BUILDING

LSI Industries’ graphics lead way

The maker of lighting products said its Q4 earnings rose 45% to 32 cents a share, beating views by 4 cents. LSI Industries’ () revenue grew 31% to $93.8 mil, above estimates. The company said its lighting segment sales grew 1%, while graphics revenue more than doubled. Shares edged up 0.8% to 19.60.

Toro, () a lawnmower maker, said its Q3 profit rose 12% to $1.02 a share, a penny above views. Revenue edged up slightly to $478.7 mil. It lowered its ‘07 sales forecast. Shares fell 7% to 53.50.

TRANSPORTATION

Alaska Air traffic up; expects loss

The airline said its July traffic rose 4.3% and jumped 18.2% at its Horizon Air unit. Alaska Air’s () revenue passenger miles increased to 1.83 bil from 1.75 bil last month. The company’s capacity widened 3% to 2.19 bil available seat miles. Alaska Air’s load factor grew 0.6 percentage point to 83.4%. It said its regional operations will post a full-year loss. Shares slid 1.4% to 24.72.

FOOD

Smithfield beats on higher sales

The producer of pork and beef products said Q1 EPS rose 27% to 47 cents ex items, beating views by 5 cents. Revenue rose 21% to $3.36 bil, above views. Smithfield Foods () said higher pork and beef sales helped the result. Q2 results will be affected by outbreaks of swine fever at 2 Romanian hog farms that have forced the company to write down inventory at an estimated pretax cost of $4 mil-$5 mil. Shares surged 8.3% to 32.58.

Hormel Foods matches estimates

The food producer said its Q3 earnings fell 5% to 41 cents, matching estimates. Hormel Foods’ () sales grew 8% to $1.52 bil, besting views. The company’s earnings were in line with its recently lowered outlook. It cited higher-than-expected input costs within the grocery products segment. Hormel sees 62-68 cents a share vs. views of 64 cents. Shares rose 1% to 34.79.

The Pope accepted the resignation of Zimbabwe’s archbishop, Pius Ncube, today after the cleric was filmed by Robert Mugabe’s secret police apparently having sex with a church secretary.

Mr Ncube said he had resigned to “protect the church” but would remain a bishop in Zimbabwe and continue to speak out against the abuses of what he has previously called Mr Mugabe’s “racist, corrupt and lawless” rule.

He also said he would fight a lawsuit brought by the husband of the woman implicated in the affair, who is demanding 20bn Zimbabwe dollars (80,000) as compensation for adultery.

The sting, in which a camera was planted in the ceiling of the archbishop’s bedroom, was widely seen as a move by Mr Mugabe to silence his most strident critic, who has described the Zimbabwean leader as a megalomaniac and called on Christians to pray for him to die.

Pictures of a man believed to be Ncube climbing naked on top of a woman were printed in the state run press, which described them as coming from “the archbishop’s love nest”. Video of the former archbishop apparently having sex was shown on Zimbabwean television several nights in a row.

The former archbishop has not directly denied the alleged affair.

In his statement today, he said he had tendered his resignation to the Pope in July within days of “what was obviously a state driven, vicious attack not just on myself, but by proxy on the Catholic church in Zimbabwe”.

“It is my feeling that I should face this case in court as Pius Ncube, an individual, not that the Holy Catholic church of God should seem to be on trial because I am its head,” he said.

The Vatican said in a one-sentence statement that Pope Benedict XVI had accepted the archbishop’s resignation under an article of church law concerning clergy who are unable to perform their duties for health reasons. It has also been used to remove clerics who brought their office into disrepute.

Mr Ncube said he would “continue to speak out on the issues that sadly become more acute by the day”.

“I have not been silenced by the crude machinations of a wicked regime,” he said.

But almost nothing has been heard from him since the allegations surfaced and there is little doubt that the power of his criticism will have been greatly diminished by the episode.

“I know that there will be many of you who will be bitterly disappointed at my leaving my post as archbishop of Bulawayo - and a few who will be delighted, seeing their mission as having been accomplished,” he said.