Tuesday, January 11, 2011

20110111 1005 Local & Global Economics Related News.

E.U: ECB President says emerging markets face inflation threats. European Central Bank President Jean-Claude Trichet, speaking on behalf of the world's central bankers, said the global economy has recovered better than expected, boosting inflation pressures in emerging markets. "Inflationary threats present some kind of general feature in the emerging world; its something you dont see necessarily in advanced economies," Trichet said. "Its clear that it is extremely important that we all keep control of inflation expectations, and that calls for appropriate decisions." (Source: Bloomberg)

Germany: May soften objections to Euro fund increase. Germany may soften its opposition to expanding the region's EUR 750b (USD 966b) rescue facility as Belgium's political deadlock sent borrowing costs surging and the European Central Bank bought Portuguese bonds. The cost of insuring against default on European sovereign debt climbed to records and European stocks fell amid concern Portugal is next in line for a bailout. Portuguese securities reversed declines after three traders with knowledge of the deals said the ECB purchased the government's bonds. (Source: Bloomberg)

France: Industrial output climbed in November at the fastest pace since January. Output from French factories, mines and utilities increased 2.3% MoM after declining 0.8% MoM in October. (Source: Bloomberg)

China: Reported a less than forecast USD 13.1b trade surplus for December, bolstering the nation's bargaining position ahead of a Jan. 19 meeting where U.S. President Barack Obama may press for more gains in the Yuan. Exports rose 17.9% YoY to USD154.2b and imports climbed 25.6% YoY to USD141.1b, the customs bureau said on its website. (Source: Bloomberg)

Malaysia: November industrial production up 5.1%
Malaysia’s industrial production index (IPI) rose 5.1% y-o-y in November, up from a revised increase of 3.1% in October, underpinned by increases in all indices namely manufacturing, mining and electricity. YTD, the IPI grew 7.8% compared to the same period in 2009. M-o-m, the index decreased 3.7%. Manufacturing output expanded by 6.5% y-o-y while mining and electricity output increased by 1.7% and 4.9% respectively. YTD, manufacturing and electricity output increased 11.3% and 9.4% respectively while mining output decreased 0.2%. (Financial Daily)

South Korea: Producer price inflation at two-year high
South Korea’s producer-price inflation rate accelerated to a two-year high, adding to the case for the central bank to raise borrowing costs again. Producer prices increased 5.3% in December y-o-y, the biggest gain since December 2008, compared with a 4.9% climb in November. Prices advanced 0.9% m-o-m. Consumer-price growth quickened to 3.5%, heading toward the central bank’s 4% ceiling. (Bloomberg)

Australia: Retail sales rise 0.3%
Australian retail sales rebounded in November as spending at department stores and other retailers strengthened in an economy generating jobs. Sales advanced 0.3% after a revised 0.8% drop in October. Spending at department stores climbed 0.8%, and consumers spent 0.8% more at other retailers such as book stores and newsstands. Consumers spent 0.1% less on groceries. (Bloomberg)

EU: French production rises most since January
French industrial output climbed in November at the fastest pace since January, a signal that growth in the euro region’s second-biggest economy may have accelerated in the final quarter of 2010. Output from French factories, mines and utilities increased 2.3% y-o-y after declining 0.8% in October, beating forecast of a 1% gain. Industrial production gained 6% y-o-y. Manufacturing output rose 2.2% m-o-m and 5.1% y-o-y. (Bloomberg)

EU: Greece’s deficit shrinks 36.5%
Greece’s central government budget deficit, which sparked a European debt crisis, contracted by more than a third last year. The gap shrank 36.5% to EUR19.6bn, more than the 33.5% forecast in the government plan. The results also give the government a EUR1.5bn cushion to cover overspending by state-controlled enterprises The austerity measures have deepened the country’s two-year recession and contributed to GDP contracting an estimated 4.2% last year. (Bloomberg)

UK: House prices decline 1.3%
UK house prices fell the most in three months in December and may extend their decline this year as uncertainty about the economy deters homebuyers. Average prices dropped 1.3% m-o-m to GBP162,435. Y-o-y, values fell 3.4%. In the quarter through December, prices fell 0.9% q-o-q. In 2010, values dropped 1.6% after a 1.1% increase in 2009. Mortgage approvals rose to 48,019 in November from 47,315 in October, the first increase in seven months. Still, that’s less than half the level at the peak of the property boom in 2007. (Bloomberg)

E.U: Western European government bonds are riskier than emerging market debt for the first time as investors brace for USD1.1tr of borrowing from euro region nations this year. The Markit iTraxx SovX Western Europe Index of credit default swaps insuring the debt of 15 countries, including Germany, Greece and Portugal, climbed to 7 basis points more than the Markit iTraxx SovX CEEMEA Index linked to Romania, Turkey and Ukraine, according to data provider CMA. The developed nations were 160 basis points more creditworthy than their emerging market peers as recently as February. (Source: Bloomberg)

Germany: Retail sales unexpectedly declined in November. Sales, adjusted for inflation and seasonal swings, dropped 2.4% MoM from October, when they rose 0.1% MoM, the Federal Statistics Office in Wiesbaden said. (Source: Bloomberg)

Germany: Exports increased in November. Exports, adjusted for working days and seasonal changes, rose 0.5% MoM from October, when they dropped 1.3% MoM, the Federal Statistics Office in Wiesbaden said. Imports increased 4.1% MoM from October, when they rose 0.1% MoM. (Source: Bloomberg)

S.Korea: Downgraded their defensive alert against the North based on intelligence that Pyongyang has relaxed the standby status of military units on the west coast, a news report said on Friday. The North Korean units, including artillery bases likely to have been involved in the shelling of a South Korean island on Nov. 23, had been on special standby but now appear to be on routine operations, South Korea's Yonhap news agency said. (Source: The Star)

Indonesia: Says 2011 core inflation may not exceed 5% even as costlier commodities threaten to push consumer-price gains above 6%, the central bank said, signaling it will keep interest rates at a record low. Bank Indonesia will work closely with the government to contain domestic prices and inflation expectations, Perry Warjiyo, director of economic research at the central bank, told reporters in Jakarta. The rupiah's appreciation will help contain price gains at about 6% this year, he said. (Source: Bloomberg) 

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