Wednesday, October 19, 2011

20111019 1112 Local & Global Economic Related News.

The  National Agro Food Policy will be launched by PM Datuk Seri Najib  Tun Razak soon, covering a period from 2011 to 2020 and focusing on ensuring  the agriculture sector continues to drive the economy through exports.  Agriculture and Agro-based Industry Deputy Minister Datuk Chua Tee Yong  said the cabinet had approved the policy which outlined four strategies to  ensure adequate supply of food and to boost the value added of food products.  (Bernama)

Retail sector for 2011 is expected to grow 6%, similar to last year's, due to  concerns of high oil prices, declining purchasing power and high cost of doing  business. A 6% growth this year means RM81.59bn worth of retail sales, said  Malaysia Retailers Association (MRA). "For 2Q11, we lower our estimate to  7% instead of the 12.6% given by retailers (+5.1% in 1Q11). For 3Q11, growth rate  is estimated at 7% due to the Hari Raya celebrations while for the last quarter,  retail industry is expected to expand by 5%,” it said. (BT)

There are no plans to use gold instead of the ringgit as a medium of payment,  Deputy Finance Minister Datuk Donald Lim Siang Chai said. Any  proposal to use gold as an alternative to cash required more study, he said.  “We must ensure an efficient monetary policy that is accepted  internationally,” he noted.  The use of gold during transactions would not guarantee that the  commodity will not depreciate. It could also invite problems related to  authenticity and counterfeiting, he added. (The Star)

Singapore's cumulative committed investments into Iskandar Malaysia have totalled RM4.13bn (S$1.7bn) as at the end of Jun this year since 2006. Out  of this figure, RM3.67bn of Singapore's investments were in the manufacturing  sector in Iskandar Malaysia while the remaining RM463m went into the  Johor-based economic zone's services sector.  This committed capital inflow from Singapore formed 5.44% of  Iskandar Malaysia's total cumulative investment of RM75.96bn in the  corresponding period, up from 4.63% until the end of 2010, said Ismail  Ibrahim, chief executive of Iskandar Regional Development Authority  (IRDA). The latest figures available for total committed cumulative investments  into Iskandar Malaysia as at the end of Sep this year was as much as  RM77.82bn. (BT)

The  US producer price index climbed 0.8% mom in Sep, the most in five  months, after no change in Aug, Labor Department figures showed. Economists  projected a 0.2% gain. The so-called core measure, which excludes volatile food  and energy, gained 0.2%, also more than predicted. (Bloomberg)

US: Overseas demand for assets climbed amid S&P downgrade
Global demand for US stocks, bonds and other financial assets in August was greater than forecast as financial-market turmoil following the downgrade of US debt by Standard & Poor’s boosted demand for Treasuries. Net buying of long-term equities, notes and bonds totaled USD57.9 bn, the highest since December 2010, compared with net buying of USD9.1bn in July, the Treasury Department said. Including short-term securities such as stock swaps, foreigners bought a net USD89.6bn, compared with net sales of USD52.4bn the previous month. (Bloomberg)

US: Homebuilder sentiment in US increases more than forecast
Homebuilders in the US were less pessimistic than forecast in October as near record-low borrowing costs and price decreases raised hopes the market will turn for the better over the next six months. The National Association of Home Builders/Wells Fargo sentiment index climbed to 18, the highest level since May 2010, from 14 in the prior month, data from the Washington-based group showed today. Economists surveyed by Bloomberg News projected the measure would rise to 15, according to the median forecast. Readings below 50 mean more respondents said conditions were poor. The Federal Reserve’s unconventional measures to boost demand and spur job growth combined with concern over the European debt crises have helped reduce mortgage rates, making buying more affordable.. (Bloomberg)

US: Wholesale prices increase 0.8%, more than forecast
Wholesale prices in the US rose more than forecast in September, boosted by gasoline, food and trucks, indicating inflationary pressures continue to bubble up the production line. The producer price index climbed 0.8%, the most in five months, after no change in August, Labor Department figures showed. Economists projected a 0.2% gain, according to the median of 71 estimates in a Bloomberg News survey. The so-called core measure, which excludes volatile food and energy, gained 0.2%, also more than predicted. Slower growth from China and Europe to the US means demand for raw materials will probably moderate, helping limit further gains in prices. (Bloomberg)

US: Industrial production increases on cars, computers
Industrial production in the US advanced in September on growing demand for automobiles and computers after stalling the prior month, a sign manufacturers are contributing to growth. Output at factories, mines and utilities increased 0.2%, in line with the median estimate in a Bloomberg News survey, after being little changed in August, figures from the Federal Reserve showed. Factory production, which makes up 75% of the total, climbed for a third month. Companies like General Motors Co. and Alcoa Inc. are getting a lift as Japan recovers from the earthquake and tsunami, and as demand from emerging markets and business investment boosts orders. At the same time, shipments to Europe may cool as the region’s debt crisis lingers, indicating factory assembly lines will probably not be running at full tilt. (Bloomberg)

Foreigners were net buyers of long-term US securities in Aug according to the  monthly Treasury International Capital report, known as TIC.  Net long-term securities transactions showed total buying of  US$57.9bn in long-term US securities in Aug, after purchases of  US$9.1bn the month before. (WSJ) Monthly net TIC inflow was US$89.6bn in Aug, compared with an  outflow of US$52.4bn in Jul. (WSJ)

The US NAHB/Wells Fargo Housing Market index rose to 18 in Oct (14 in  Sep), the group said. It was the highest level since May 10. Economists predicted  the index would rise to 15. (Reuters)

German: Investor confidence fell to three-year low in October
German investor confidence fell to the lowest in almost three years in October as Europe’s debt crisis threatened to infect banks and curb economic growth. 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, declined to minus 48.3 from minus 43.3 in September. That’s the lowest since November 2008. Economists expected a drop to minus 45, according to the median of 39 estimates in a Bloomberg News survey. (Bloomberg)

Japan’s department store sales fell 2.4% in Sep (-1.7% in Aug), hit by two  major typhoons on weekends, posting the third straight yoy drop, data released  by the Japan Department Stores Association showed. (MNI)

Japanese Machine Tool Orders grew 20.1% in Sep, in comparison with  20.3% in Aug, according to data released by the Japanese Machine Tool  Builders Association. It is the lowest result since Oct 09 when it stood  at -21%.  (NASDAQ)

Japan is preparing to ease  restrictions on US beef imports as concerns  about mad cow disease receded and domestic cattle production fell after the  nation’s worst nuclear disaster since World War II. Japan was the biggest buyer  of American beef before an outbreak in 2003. (Bloomberg)

China’s industrial production increased 13.8% yoy in Sep (+13.5% in Aug).  Economists were expecting a 13.4% yoy increase. (Bloomberg)

In  China,  fixed-asset investment excluding rural households climbed  24.9% yoy in 9M11, (+25% in 8M11), of which property investment for 9M11  rose 32% yoy, from 33.2% in 8M11. The consensus estimate by economists  called for a 24.8% increase in the headline figure. (Bloomberg)

Retail sales in  China expanded 17.7% yoy in Sep after a 17% gain in Aug.  Economists were expecting an expansion of 17.1% yoy. (Bloomberg)

China’s  home prices gained in 24 of the 70 cities monitored by the  government in Sep, compared with 23 cities in Aug. A total of 17 cities posted mom declines in  housing values, and were unchanged in 29 cities. Average  housing prices across the nation were up just 0.01% mom in Sep.  Property  sales rose 23% yoy to Rmb3.9tr (US$611bn) in 9M11.  New property  construction climbed 24% to 1.48bn square meters (16bn square  feet)  between Jan and Sep. (Bloomberg)

China’s state-owned companies’ profit rose 19.4% yoy in 9M11 to  Rmb1.71tr. Revenue gained 24.3% yoy while net income for state-owned  companies. (Bloomberg)

China: Economy grows least in 2 years as Europe demand cools
China’s economy grew 9.1% in the third quarter from a year earlier, the slowest pace since 2009, driving stocks lower on concern that Europe’s debt crisis is dragging on the global recovery. The gain was less than the median estimate of 9.3% in a Bloomberg News survey of 22 economists and followed a 9.5% increase in the previous three months. Asia’s benchmark stock index sank after China’s growth was limited by tighter credit and weaker demand from Europe, where Germany yesterday rejected speculation that any immediate resolution of the region’s crisis is possible. A slowdown in the pace of China’s expansion, which remains five times that of the US, may help Premier Wen Jiabao to tame inflation that is above the government’s target. (Bloomberg)

A government source said the NESDB reported that the agency has cut  Thailand’s economic growth  projection for 2011 to 2.1% from an earlier  prediction of 3.8%. NESDB secretary-general Arkhom Termpittayapaisith said  the floods have affected 252,716 workers in all sectors and would cause four  industrial estates and  one industrial zone in Ayutthaya to lose revenue of  THB350bn. (Bangkok Post)

Thailand’s Cabinet approved a request to widen this year’s  budget deficit by THB50bn to a total of THB400bn because of costs associated with the  nation’s floods, Finance Minister Thirachai Phuvanatnaranubala said.  Expenditure will rise to THB2.38tr and revenue will total THB1.98tr.  (Bloomberg)

Data from the  Association of Indonesia Automotive Industries (Gaikindo) shows that  car sales rose 62.4% yoy in Sep to reach 79,835 units,  (+13.1% in Aug). Motorcycle sales climbed 50.6% yoy in Sep to reverse a 7.3%  decline in Aug. (Bloomberg)

The  Philippine Supreme Court will stop the  government from imposing  and collecting a 20% tax on interest income on PP35bn worth of bonds due,  spokesman Midas Marquez said. The government expects to collect almost  PP5bn in taxes from PEACe bonds sold in 2001. (Bloomberg)

Chinese crude steel production in Sep shrank 3.5% mom to 56.7m tonnes.  The figures are slightly lower than estimates made by the China Iron and Steel  Association, which put Sep output at 58.13m tonnes. (Reuters)

Indonesia's central bank expects  loan growth to ease slightly to 23-24% in  2012 (compared to a 24-25% this year) as the global economic slowdown weighs  on domestic growth, Deputy Governor Halim Alamsyah said. (Reuters)

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