WASHINGTON - THE US economy shrank more severely during the third quarter than first estimated as consumers cut spending at the steepest rate in 28 years, according to a Commerce Department report on Tuesday that underlined how rapidly activity was slowing.

Corporate profits fell for a second straight quarter and business investment fell, the department said as it revised the annual rate of decline in third-quarter gross domestic product to 0.5 per cent from 0.3 per cent that it reported a month ago.

PARIS - THE number of unemployed in leading industrialised nations is set to rise by eight million in the next two years as rich countries battle their worst recessions in 25 years, the OECD said on Tuesday.

'Jobless numbers could rise to 42 million by 2010 from 34 million currently,' the OECD said in a report, forecasting the jobless rate to rise from 5.5 per cent in early 2008 to 7.25 per cent in 2010.

TEMASEK Holdings confirmed on Tuesday that it will raise its stake in Britain's Standard Chartered, possibly to as much as 22 per cent, as part of a rights issue.

Analysts say the move appeared to be an example of Temasek jumping in at cheap prices seeking longer term returns.

WASHINGTON - THE Federal Reserve announced plans on Tuesday to pump up to US$800 billion (S$1.2 trillion) into the financial system in purchases of mortgage- and asset-backed securities.

The US central bank said it would launch purchases of up to US$100 billion of obligations of housing-related government-sponsored enterprises including Fannie Mae and Freddie Mac in the next week, and buy another US$500 billion in a process started by the end of this year.