Wednesday, March 31, 2010

20100331 1043 Global Economic News.

The US Conference Board’s confidence index rose to 52.5 in March from 46.4 in February, exceeding the median forecast of economists. The Conference Board’s measure of present conditions increased to 26 from 21.7, the highest level since May. The gauge of expectations for the next six months rose to 70.2 from 62.9. (Bloomberg)

US home prices, according to the S&P/Case-Shiller Home Price Index of 20 cities, unexpectedly rose in January indicating the housing market is stabilising as the economy expands. The home-price index climbed 0.3% mom on a seasonally adjusted basis, matching the gain in December. The gauge was down 0.7% from January 2009, the smallest year-over-year decrease in three years. (Bloomberg)

Chicago Federal Reserve Bank President Charles Evans said he was "very concerned" about unemployment in the United States, predicting that the unemployment rate would rise above 9% by the end of the year. Evans forecast the unemployment rate to contract, however, to 8% by the end of 2011 and then to 5% with an economic recovery. (CNBC)

President Barack Obama and four other leaders (South Korean President Lee Myung Bak, UK Prime Minister Gordon Brown, Canadian Prime Minister Stephen Harper and French President Nicolas Sarkozy) said “more work” is needed to repair the balance sheets of some international banks after the worst financial crisis since the Great Depression. “While confidence in the financial system has improved, more work is required to restore the soundness of some global banks’ balance sheets, to avoid leaving the global financial system vulnerable and restricting its ability to provide the credit needed to fuel sustainable growth,” they said. (Bloomberg)

The International Monetary Fund (IMF) cut its growth forecast for Germany after a recovery in Europe’s largest economy came to a halt, and said the government needs a “credible” plan to reduce its deficit. It expects the German economy to expand 1.2% this year and 1.7% in 2011 (vs. January’s forecast of 1.5% in 2010 and 1.9% in 2011). (Bloomberg)

Britain emerged from recession in 4Q09 at a faster pace than previously estimated, providing a boost for Prime Minister Gordon Brown with a general election weeks away. Gross domestic product (GDP) rose 0.4% qoq in 4Q09 (vs. previous calculation of 0.3%). Economists forecast for a 0.3% increase. (Bloomberg)

Reserve Bank of Australia (RBA) Governor Glenn Stevens said policy makers need to manage economic “upswings” to prevent future deep downturns, signaling that the central bank may raise interest rates next week. “Very deep recessions leave a long-lasting legacy of unemployment and all the things that go with it,” he noted. (Bloomberg)

Japan’s industrial production fell 0.9% mom in February (+2.7% in Jan) and the unemployment rate held at the lowest level (4.9%) since Mar 09, underscoring an uneven economic recovery that has yet to end deflation. Household spending unexpectedly slipped 0.5% yoy in February (+1.7% in Jan), marking the first decline in seven months. (Bloomberg)

A growing number of foreign companies in China plan to relocate plants inland or outside the country because of rising labor and logistics costs, a survey by the American Chamber of Commerce in Shanghai showed. The proportion of companies with such plans doubled last year compared with 2008. Southwest or central Chinese cities and emerging Asian economies including India, Vietnam and Indonesia are “new horizons” for their lower-cost, export-driven operations. Multinational corporations still prefer China in order to benefit from the nation’s rapid expansion, it said. (Bloomberg)

Hong Kong’s retail sales rose 35.8% yoy to HK$26.9bn in February (6.5% in Jan), marking the fastest pace in more than 20 years after unemployment fell and more tourists arrived during the Lunar New Year. Economists forecast it would increase by 39.0%. (Bloomberg)

Singapore’s electricity will cost more for the upcoming quarter, starting April. It will be the fourth consecutive quarter of increase due to a continued increase in fuel oil prices. The average fuel oil price over the last three months has increased from S$99.38 to S$102.95 per barrel. With the increase of some 3.0%, electricity will cost 23.56 cents per kilowatthour. (Channel News Asia)

Vietnam’s economic growth accelerated to 5.83% yoy in 1Q10 (6.9% in 4Q09), buoyed by construction, tourism and banking services amid robust domestic demand. Industry and construction expanded 5.65% and services grew 6.64% in 1Q. (Bloomberg)

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