Wednesday, June 22, 2011

20110622 1019 Local & Global Economic Related News.

Malaysia: Car sales impacted by amended Act
Worried about the possibility of trickling cash flow, a rise in booking cancellations and longer lead time for completion of sales, many stakeholders in the automotive sector say the recent amendments to the Hire-Purchase Act 1967 (HPA) will hurt the car retail trade. Already, there are complaints of a slowdown in sales. Under the amendments, effective 15 June, all used vehicles for sale will undergo Puspakom’s 18-point inspection to ensure their roadworthiness. Another issue of contention was the 1% maximum booking fee (based on the total selling price) mandated by the amended Act, which requires car sellers to refund customers 90% of the booking fee if the deal falls through. (StarBiz)

Malaysia: Minimum wage bill tabled
A bill that will pave the way for the implementation of minimum wages was tabled at the Dewan Rakyat for the first and second reading yesterday. The National Wages Consultative Council Bill 2011, tabled by Deputy Human Resources Minister Datuk Maznah Mazlan, seeks to replace the Wages Council Act 1947 and set up a National Wages Consultative Council to conduct studies on minimum wage. The council will also make recommendations to the government on minimum wages according to sectors, types of employment and regions. Prime Minister Datuk Seri Najib Razak said he hoped to have the minimum wage policy in place by year-end if Parliament passed the bill. Once the bill is passed, the council can make recommendations through the minister on coverage, commencement and implementation of recommended minimum wage rates. (NST)

Greece: Papandreou wins Greek confidence vote, boosts rescue chances
Greek Prime Minister George Papandreou won a vote of confidence, bolstering his new government’s chances of pushing through austerity measures to secure further international financial aid for the country. A total of 155 lawmakers supported the motion in the 300-seat parliament in Athens early this morning, with 143 voting against, the speaker, Filippos Petsalnikos, said. Papandreou reshuffled his Cabinet and sought the approval of the chamber after fending off a revolt within his socialist Pasok party last week. After the vote, police used tear gas to disperse crowds protesting Papandreou’s budget cuts. (Bloomberg)

Germany: Investor confidence declined to two-year low in June as the region's debt crisis dimmed the economic outlook. The ZEW Center for European Economic Research in Mannheim said its index of investor and analyst expectations, which aims to predict developments six months in advance, fell to -9 from 3.1 in May. That's the lowest since January, 2009. (Source: Bloomberg)

U.K: Budget deficit narrowed to GBP 17.4b (USD 28.2b) in May as growth in tax receipts outpaced government spending. The shortfall compared with GBP 18.5b a year earlier, the Office for National Statistics said in London. (Source: Bloomberg)

Spain: IMF sees 'considerable' risks amid European debt crisis. The International Monetary Fund said Spain must step up efforts to reform its economy as Europe's sovereign debt crisis threatens to damp growth. "The repair of the economy is incomplete and risks are considerable," the Washington-based IMF said in its annual appraisal of Spain. There must be "no let up in the reform momentum" to bolster the recovery and reduce a 21% unemployment rate that is "unacceptably high," the fund said. (Source: Bloomberg)

US: Existing-home sales fell in May to six-month low
Sales of existing US homes decreased in May to the lowest level in six months, a sign that the housing market is lagging other parts of the economy. Purchases of existing homes fell 3.8% to a 4.81m annual pace last month, in line with the 4.8m median estimate in Bloomberg News survey of economists, data from the National Association of Realtors showed. The median sales price declined from a year earlier and 31% of transactions were of distressed dwellings. An unemployment rate hovering around 9% and tight credit standards mean it may take years to absorb the 1.8m distressed properties on the market that are weighing down home values. Persistent weakness in the housing market is one reason why Federal Reserve policy makers are likely to maintain record stimulus when they meet this week.(Bloomberg)

US stocks advance as concern about Greek debt default eases
US stocks advanced, sending the Standard & Poor’s 500 Index higher for a fourth straight day, as concern about Greece’s debt crisis eased. Wells Fargo & Co and Citigroup Inc rose at least 1.8%, following a rally in European banks, as Greece’s government faces a confidence vote that may determine whether it avoids a default. Caterpillar Inc, Alcoa Inc and Hewlett- Packard Co added more than 0.8%, pacing gains among companies most-tied to economic growth. Best Buy Co climbed 2.7% as the largest consumer electronics retailer set a USD5bn share repurchase plan and raised its quarterly dividend. The S&P 500 rose 1.3% to 1,295.52 at 4 pm in New York. The Dow Jones Industrial Average added 109.63 points, or 0.9%, to 12,190.01. The Nasdaq Composite Index gained 2.2% to 2,687.26, reversing its 2011 drop. The Russell 2000 Index of small companies increased 2.3% to 806.37. (Bloomberg)

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