Malaysia: Seeks World Bank help to cut spending, trim deficit Malaysia will ask the World Bank to help in the country’s efforts to cut Government spending as Prime Minister Najib Razak seeks to reduce the budget deficit from a 22-year high. The nation is asking the Washington-based lender to review all areas of government expenditure, including how state contracts are awarded, to prevent waste from inefficiency, Second Finance Minister Ahmad Husni Hanadzlah said in an interview in Kuala Lumpur. Malaysia hopes the study will bolster the Government’s credibility, he said. (Bloomberg)
China: Inflation surge prompts expectations of rate hike China said that consumer prices rose at their fastest pace in more than two years in October, raising expectations of another rate hike as Beijing admits it may miss its 2010 inflation target. The CPI, a key measure of inflation rose 4.4% y-o-y last month, compared with 3.6% in September, the National Bureau of Statistics said. (BT)
China: Reluctance to take yuan ‘medicine’ hampers G-20 progress Group of 20 nations’ efforts to tackle currency and trade imbalances floundered as China rejected policy prescriptions that fault its exchange rate regime and directed criticism at additional monetary easing in the US. “Don’t make other people take the medicine for your disease,” Yu Jianhua, a director general at China’s Ministry of Commerce, told reporters in Seoul. “Quantitative easing will have a very big impact on developing countries including China.” (Bloomberg)
Japan: Growth probably peaked as yen gains weighed on expansion Japan’s expansion may slow toward the end of this year after getting a temporary boost in the third quarter as a surging yen crimps exports and fading stimulus measures force consumers to pare outlays. GDP grew at an annualized 2.5% in the three months ended 30 Sept, following a 1.5% expansion in the previous quarter, according to the median forecast of 21 economists surveyed by Bloomberg News. (Bloomberg)
Australia: October jobless rate unexpectedly jumps Australia’s unemployment rate unexpectedly jumped in October to a six-month high as the pool of workers and job seekers swelled to a record, easing concern that a labor shortage will drive up wages. The jobless rate rose to 5.4% last month from 5.1% in September, the statistics bureau said. That exceeded the median forecast of 5% in a Bloomberg News survey of 24 economists. (Bloomberg)
US: Geithner says dollar drop due to haven-flow reversal Treasury Secretary Timothy F. Geithner said the dollar’s drop in recent months is due to a reversal in safehaven capital flows, rebutting former Federal Reserve Chairman Alan Greenspan’s assessment of US policy. Investors are no longer seeking as much of a refuge in dollars, and that’s “a sign of greater confidence that although we face challenges in the US and globally the risks we face are more manageable,” Geithner said in a transcript of an interview with CNBC television distributed by e-mail. This shift is “the dominant trend that we see,” he said. (Bloomberg)
Malaysia: Holds rate as inflation, global growth ease Malaysia’s central bank left borrowing costs unchanged for a second consecutive meeting as inflation and global growth eased, avoiding an increase that may attract capital inflows and strengthen the nation’s currency. Bank Negara Malaysia kept its benchmark overnight policy rate at 2.75%, it said in a statement in Kuala Lumpur, a decision predicted by all 16 economists surveyed by Bloomberg News. This was the central bank’s final ratesetting meeting for 2010. (Bloomberg)
Malaysia: World Bank- Slower growth ahead for Malaysia on external uncertainty The World Bank has forecast a moderation in Malaysia’s economy growth for 2011 and 2012 on the back of near-term uncertainty from the weakness of the global economy, while the country’s medium-term growth rests on implementation and progress on fiscal consolidation. The World Bank projects Malaysia’s GDP to be at 4.8% in 2011 and 5.7% in 2012 due to base effects and prospects of weaker global economic conditions dampening domestic confidence. (Financial Daily)
EU: Ireland says it’s in talks on markets as Germany pushes aid Ireland said it’s in talks with European officials about “market conditions” as Germany pushes it to accept a
bailout before a meeting of finance ministers on 16 Nov that aims to reverse a bond sell-off across the euroregion’s periphery. “Ongoing contacts continue at official level with international colleagues in light of current market conditions,” a Finance Ministry spokesman said in an email. “Ireland has made no application for external support” and the government is “fully funded till well into 2011,” the spokesman said. (Bloomberg)
US: Pushes China to show yuan progress before Hu’s January trip The US called on China to let the yuan rise before President Hu Jintao’s planned January trip to Washington, setting a deadline for results after Group of 20 leaders failed to reach a broad agreement on currencies. Hu’s US visit “will be an important time to look at exactly what the quantum of progress has been” on China’s currency reforms, National Security Adviser Thomas Donilon told reporters in Yokohama, Japan. The pace of the moves is a “sovereign decision” and the US “will certainly be looking.” (Bloomberg)
US: Consumers gain confidence as jobs, shares rise Consumers in the US gained confidence in November for the first time in three months, raising the odds that an improving job market and increasing wages and stock prices will lift spending. The Thomson Reuters/University of Michigan preliminary sentiment index rose to 69.3, in line with the median forecast of economists surveyed by Bloomberg News and the highest level since June, from 67.7 in October. The measure averaged 88.9 in the five years to December 2007, when the last recession began. (Bloomberg)
U.S: Fed resumes easing with USD 7.229b of Treasuries in attempt to drive down borrowing rates to help reduce unemployment and avert deflation. Policy makers acquired 16 of the 24 securities maturing from November 2014 through April 2016 that were listed on the Federal Reserve Bank of New York's website. The acquisitions are part of the Fed?s plan to acquire USD 600b of Treasuries through June and reinvest maturing mortgage holdings. (Source: Bloomberg)
E.U: Growth slows in 3Q10 as deficit cuts dent recovery . Gross domestic product in the 16-nation euro area rose 0.4% QoQ from the second quarter, when it increased 1% QoQ. Industrial output fell 0.9% MoM in September from the previous month, the largest drop in 18 months, separate data showed. (Source: Bloomberg)
Germany: Economic growth slowed in 3Q10 , after record expansion in the second. GDP, adjusted for seasonal effects, rose 0.7% QoQ from the second quarter, when it surged an upwardly revised 2.3% QoQ, the Federal Statistics Office in Wiesbaden said. (Source: Bloomberg)
France: 3Q10 GDP growth slips as a surge in imports and a decline in manufacturing overshadowed increasing household spending. GDP rose 0.4% QoQ in the three months through September, down from the 0.7% QoQ gain in the previous quarter, Paris-based statistics office Insee said. (Source: Bloomberg)
Italy: Economy expanded less than expected in 3Q10 . GDP rose 0.2% QoQ from the second quarter when it climbed 0.4% QoQ. The economy expanded 1.0% YoY. (Source: Bloomberg)
H.K: Economy expands more-than-forecast 6.8% YoY in 3Q10 . The gain in GDP compared with a 6.5% YoY increase in the three months ended June 30. (Source: Bloomberg)
India: Industrial production growth unexpectedly slowed to a 16-month low in September . Output at factories, utilities and mines rose 4.4% YoY after a revised 6.9% YoY increase in August. (Source: Bloomberg)
Philippines: Debt rating was raised to the highest level in more than seven years by Standard & Poor's , which cited the country?s strong external liquidity, foreign reserves, and progress in debt reduction. The rating on the nation's government debt was raised one level to BB from BB-, the rating company said in a statement. (Source: Bloomberg)
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