20100323 0947 Global Economic News.

The US is on track for a "reasonable" recovery in 2010, and the corner has been turned in the jobs market, James Bullard, President and CEO of the Federal Reserve Bank of St. Louis, said in a CNBC interview. Bullard expressed cautious optimism about the US economic outlook and argued for the reversal of quantitative easing before rate hikes as the best exit strategy. (Xinhua)

Atlanta Federal Reserve President Dennis Lockhart warned that although he is not concerned about inflation in the immediate future, concerns over the rising US deficit and belief the country will inflate out of the problem could increase inflation expectations and present a dilemma for monetary policy. "If such a situation begins to develop, the Fed will face a difficult trade-off between continued support for the recovery and aggressive action to re-anchor inflation expectations," Lockhart said. (Xinhua)

The US House of Representatives gave final approval to a sweeping healthcare overhaul on Sunday, expanding insurance coverage to nearly all Americans and handing President Barack Obama a landmark victory. The overhaul extends health coverage to 32m Americans, expands the government health plan for the poor, imposes new taxes on the wealthy and bars insurance practices such as refusing to cover people with pre-existing medical conditions. (Malaysian Reserve)

Initiatives to curb imports (so called trade protectionism) are rising around the world, threatening “disastrous consequences,” the head of the Organization for Economic Cooperation and Development (OECD) said. Historically high unemployment, “low” economic growth and record budget deficits in a number of countries are the “perfect breeding ground” for protectionism, said Secretary-General Angel Gurria. (Bloomberg)

Chinese Premier Wen Jiabao appealed to CEOs gathered in Beijing to help the world avoid a trade and currency war as lawmakers in the US call for stronger measures to compel China to revalue the yuan. (Bloomberg)

UK Chancellor of the Exchequer Alistair Darling will propose this week a £2bn (US$3bn) fund to encourage corporate investment, an effort to spur the economy while containing a record budget deficit. Darling’s 24 Mar pre-election budget will channel money from asset sales to leverage investment by companies in infrastructure and clean energy. His spending plan will avoid pre-election “giveaways” and tax increases on the rich. (Bloomberg)

The UK’s economic recovery will be “slow and sluggish” this year as consumers choose to save more and spend less, the Confederation of British Industry said. The economy will grow 0.3% in 1Q and 0.4% in 2Q before expanding 0.5% in the last two quarters of the year. Gross domestic product (GDP) will increase 1.0% this year and 2.5% in 2011. (Bloomberg)

Chinese Premier Wen Jiabao said that China would steadfastly stick to the practice of expanding its domestic demand, which is considered a long-term strategy. Though China had generally done well in combating the impact of the global financial crisis, the crisis actually has challenged China's mode of economic growth, Wen said, adding the shifting of the economic growth pattern needs to be done urgently.

• "We should shift the economy's dependence from external demand to domestic demand, and make great efforts to shorten the gaps between regions, and between urban and rural areas," Wen noted. (Xinhua)

Hong Kong’s inflation accelerated 2.8% yoy in February (1.0% yoy in Jan), marking a 13- month high as consumer demand rose and the timing of a Lunar New Year holiday distorted prices. That compared to the market consensus of a 2.1% yoy increase. (Bloomberg)

Singapore’s Building and Construction Authority is setting up a S$15m fund to promote sustainable construction. The fund will focus on developing capabilities in recycling waste from the demolition of buildings and in using recycled materials for construction. (Channel News Asia)

Thailand’s Finance Minister Korn Chatikavanij said that a move by the central bank to raise interest rate at its next policy meeting would not be a surprise, prompting bond yields and swap rates to edge up. The next central bank policy review is scheduled for 21 Apr. He expects the economy to grow at least 4.0% this year. “If they choose to address the low-rate scenario, they will be sending out a message that the economy is well on the road to recovery,” he added. (Financial Daily)

The Philippine central bank Governor Amando Tetangco said that Bangko Sentral ng Pilipinas is unlikely to raise its main interest rate in 1H10 to avoid endangering an economic rebound that’s just starting. “I don’t see large, chunky movements in interest rates this year. Inflation remains manageable and within target,” Tetangco said. (Bloomberg)

Reserve Bank of India (RBI) Governor Duvvuri Subbarao said India risks a “hard landing” if inflation isn’t reined in. “If we don’t tighten now and take action, the adjustment that we will have to make later on will be strong and we might indeed have a hard landing. Even if there’s a short-term trade-off between growth and inflation, in the medium term it is important that inflation is kept low in order to sustain growth,” Subbarao said. (Bloomberg)

Indonesia’s central bank may keep its benchmark interest rate unchanged this year as inflationary pressure remains benign, Bank Indonesia Deputy Governor Hartadi Sarwono said. “If the inflation rate hovers around 5-6%, it is not urgent yet to raise the interest rate,” Sarwono said. (Bloomberg)