Thursday, July 21, 2011

20110721 1358 Local & Global Economic Related News.

The  consumer price index (CPI) rose 3.5% yoy in Jun (3.3% in May). Economists had  projected for a 3.6% gain.  On a mom basis, it perked 0.3%. For the first six months, the  CPI was up 3.0%. (Bernama, BT)

Malaysia: Inflation quickens, adding pressure for higher rates
Malaysia’s inflation accelerated to the fastest pace in more than 2 years in June after power tariffs were raised, adding pressure on the central bank to resume interest rate increases to contain price gains. Consumer prices rose 3.5% from a year earlier after climbing 3.3% in May. (Bloomberg)


Malaysia and Japan will invest RM750m to set up the Malaysia-Japan International  Institute of Technology (MJIIT), said Japan’s ambassador to Malaysia Shigeru  Nakamura. The investment, which spans seven years until 2017, includes operational cost,  laboratory equipment, and infrastructure.  
  • Of the total, Malaysia contributed 67% while the rest was financed by the Japanese  government.   
  • The  institute is located at Universiti Teknologi Malaysia’s (UTM) Jalan Semarak  international campus, which scheduled to take its first batch of 130 students by Sep this  year. (BT)    

The income gap between urban and rural Malaysians is bigger today than before the  country gained independence, a trend that could lead to social instability, said Dr  Muhammed Abdul Khalid, a Fellow with the Institute of International and Strategic Studies  (ISIS). The income gap between the top 20% and bottom 40% widened from RM659 in  1970 to RM8,547 in 2009. He also warned that high inequality trend could also affect  economic growth. (BT)

The government has extended the deadline for utilisation of the  Working Capital  Guarantee Scheme (WCGS) for Bumiputera companies until end-2012, from the end of  2011. Minister in the Prime Minister’s Department Tan Sri Nor Mohamed Yakcop said the  one-year extension would be sufficient for Bumiputera companies to fully utilise their  RM1.5bn allocation under the scheme. So far, only RM300m have been utilized by them.  (BT)  

A total of 909,518 transactions valued at US$76.5m  were undertaken by  MasterCard  cardholders from Malaysia and overseas during the first weekend of the 1Malaysia Mega  Sale Carnival 2011 (1MMSC) from 17 Jun to 19 Jun. Mastercard Worldwide Inc in a  statement said the amount was an increase of US$2.3m compared with US$74.2m spent  during the first weekend of MMSC last year from 30 July to 1 Aug.  
  • Malaysian cardholders' spending increased to US$68.4m from US$67.1m previously  with 854,776 transactions made.  
  • The spending of cardholders from overseas increased by 14% to US$8.1m from  US$7.1m with 54,742 transactions made. (Bernama)    

Malaysia has become the third largest investor in Cambodia with its investments in the  country amounting to US$3.4bn from 1980. Malaysian Ambassador to Cambodia, Datuk  Pengiran Mohd Hussein Datuk Pengiran Mohd Tahir Nasruddin said Malaysia'a third  placing comes after China and Korea. The investment opportunities for Malaysia are still  plenty especially in the agriculture sector considering the availability of large areas of land  which are yet to be developed in the country, he said. (Bernama)

Malaysian ports handled 10.5% more containers in the first six months of the year, said  Transport Minister Datuk Seri Kong Cho Ha. 9,856,859 twenty foot equivalent units (TEUs)  containers were handled between January and June against 8,921,113 TEUs registered in  the same period last year. (Bernama, BT)  

U.S. home mortgage applications surged last week, racking up the biggest increase in  four months on a flood of refinancing demand as interest rates remained low, an industry  group said. The Mortgage Bankers Association said its seasonally adjusted index of  mortgage application activity spiked up 15.5% in the week ended 15 Jul. It was the largest  increase since early Mar. The MBA's seasonally adjusted index of refinancing applications  soared 23.1%, but the gauge of loan requests for home purchases dipped 0.1%. Fixed 30- year mortgage rates averaged 4.54%, easing from 4.55%. (Reuters)  

US: Obama huddles with leaders on debt deal
President Barack Obama met separately with Republican and Democratic congressional leaders on Wednesday, keeping up efforts to try to strike a deficit reduction deal and head off default by the US government. Obama would also support a short-term extension in the debt ceiling if it allows time for a broader agreement to be enacted, the White House said Wednesday. (Marketwatch.com)


Sales of previously owned US homes dropped in Jun for the third straight month amid  an unexpected spike in contract cancellations, an industry group said. Existing-home sales  slipped 0.8% mom to a seasonally adjusted annual rate of 4.77m in Jun (4.81m in May),  the National Association of Realtors (NAR) said. Economists had estimated sales would  rise to a 4.93m rate. (AFP, NAR)  

Eurozone consumer confidence eroded more than generally expected in Jul after a  recovery over the past two months, according to the European Commission's preliminary  estimate released. The index dropped to -11.4 in Jul (-10.3 in Jun). Economists expected a  reading of -10.5. (MNI, Bloomberg)  

Japan’s leading composite index, which measures the state of the economy three  months ahead: May 99.6, posting the first mom rise in three months. (MNI)  

A Chinese leading indicator climbed for the third straight month, adding to evidence that  the world’s second-biggest economy is withstanding Europe’s debt crisis and faltering  growth in the U.S. The index rose 0.5% to 155 in May (+0.1% in Apr), The Conference  Board said, citing a preliminary reading. The gauge is designed to capture prospects over  the coming six months.  (Bloomberg)  

China said that it can allow more yuan moves without jeopardizing its foreign-exchange  reserves after letting the currency rise today to a 17-year high against the dollar. “The  changes in the yuan’s exchange rate against the U.S. dollar causes changes in the paper  value of the reserves when valued in yuan,” the State Administration of Foreign Exchange  said. “This is not a real loss and will not affect the real overseas purchasing power of the  foreign-exchange reserves.” (Bloomberg)  

The Thai automotive industry is likely to miss its export target of 1m units this year  because of a shortage of car parts over the past two months resulting from the earthquake  and tsunami in Japan, the Automotive Industry Club under the Federation of Thai  Industries (FTI) says. (The Nation)

Taiwan: Export orders rose the least in 4 months in June
Taiwan’s export orders increased at the slowest pace in 4 months in June as sales to Japan slumped and demand from Europe moderated. Orders climbed 9.2% from a year earlier, after an 11.5% gain in May. (Bloomberg)

Brazil: Raises key rate to 12.5%
Brazil's central bank raised the country's benchmark rate by 25bps to 12.5%, meeting widely held expectations. The central bank has raised the key rate at six consecutive meetings from the 10.75% level. (Marketwatch.com)

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