Bank Negara Malaysia (BNM), the Hong Kong Monetary Authority (HKMA) and Euroclear Bank have jointly launched a pilot platform for cross-border investment and settlement of debt securities to be operational on 30 Mar. It would enhance cross-border debt securities settlement efficiency and strengthen the capacity for debt securities issuance activities in the Asian region. (BNM)
Malaysia has shifted its investment focus to more high technology and capital intensive industry-related deals, said Deputy Minister of International Trade and Industry, Datuk Mukhriz Tun Dr Mahathir. "We are also focusing on attracting industries that undertake research and development. We no longer want to attract labour intensive investments. For the past two years, we have been experiencing a steady growth in attracting these kind of investments," Mukhriz said. (Bernama)
Philippine exports grew 3% yoy in Jan (-18.9% in Dec) to US$4.12bn, ending eight months of contraction. Jan's exports were also 21% mom higher. (WSJ)
Moody’s has expressed confidence that the Philippines would manage to further trim its debt burden, hinting again that it was poised to soon upgrade the country’s credit-rating. (Philippine Daily Inquirer)
The University of the Thai Chamber of Commerce has raised its GDP projection for 2012 to 5.9% from the previous prediction of 4.7%. (Bangkok Post)
The Bank of Thailand has raised its crude oil price benchmark for this year to US$140 per barrel from $103.3 per barrel. The core inflation target for 2012 is between 0.5 and 3.0%. The headline inflation for this year should be 3.0% +/- 1.5% pts. (Bangkok Post)
The Commerce Ministry has confirmed that Thailand’s exports in 2012 will grow by 15% but will be negative in 1Q12 given that the sector is still recovering from the flood. (Thai Financial Post)
Indonesia will go ahead with a proposal to control the use of subsidized fuels in the revised 2012 state budget at 40m kiloliters, and would serve as a complement to the government’s plan to raise the price of subsidized fuels by Rp1,500/liter as of 1 Apr. (Antara News)
Singapore is Asia’s most competitive city in attracting businesses, efficiency and promoting a clean environment, according to an Economist Intelligence Unit report commissioned by Citigroup Inc. (Bloomberg)
The China Manpower Survey increased to 19% in 2Q12 from 17% in 1Q12, indicating that employers in China intended to add jobs. There were also improvements in hiring conditions in other economies like India (48% in 2Q from 41% in 1Q) and Singapore (20% in 2Q from 16% in 1Q). Job seekers in 23 of 41 economies surveyed can expect a faster pace of hiring in 2Q compared with 1Q. (Bloomberg, Reuters)
The cash reserve requirement imposed on banks by China's central bank can be injected into the stock market to boost investor confidence, Jiang Lianhai, a deputy to the National People's Congress said. (China Daily)
The People's Bank of China said that commercial banks should put in place a differentiated credit policy to guarantee housing loans to qualified first-home buyers. (Xinhua)
The Bank of Japan (BOJ) left its key policy rate unchanged and decided to expand a loan program for potentially high-growth sectors in a bid to stimulate the economy. As part of the ¥2tr (US$24.31bn) expansion, BOJ will use its foreign-currency assets to offer ¥1tr worth of loans denominated in US$ for the first time. BOJ will also extend the application period for the loans by two years to Mar 2014. (WSJ)
Bank of Japan Governor Masaaki Shirakawa and his board yesterday rejected one member’s suggestion to build on the ¥10tr (US$121bn) of additional government-bond purchases announced 14 Feb as “the Bank of Japan doesn’t change its monetary policy because it’s mindful of political pressure,” adding that bending to politicians would be “suicide.” (Bloomberg)
Japan received approval from China's government to purchase Rmb65bn in Chinese government debt in a move that can help Japan diversify its reserves away from the dollar and strengthen economic ties between the two Asian countries. Finance Minister Jun Azumi said the timing of purchases hasn't been set yet as Japan still needs to make some administrative preparations, but it will likely start with a small amount and then increase purchases. (Reuters)
South Korea: Unemployment rate rose to 3.7% in february
South Korea’s unemployment rate unexpectedly jumped to the highest level in almost a year as college graduates entered the labor market and government job openings encouraged more people to seek work. The jobless rate rose to 3.7% in February from 3.2% the previous month, Statistics Korea said in Gwacheon today. The median estimate in a Bloomberg News survey of 11 economists was for the rate to stay at 3.2%. Policy makers are grappling with a slowing economy by supporting the job market, accelerating spending and keeping interest rates unchanged for a ninth month. The Bank of Korea said last week the economy appears not to be slowing further and will likely return to its long-term growth track, although downside risks persist because of Europe’s debt crisis and higher oil prices. (Bloomberg)
Australia: Consumer confidence slumps 5%, most in three months
Australian consumer confidence fell the most in three months after the nation’s four biggest lenders raised mortgage rates even as the central bank left the benchmark borrowing cost unchanged, a private survey showed. The sentiment index for March dropped 5% to 96.1, the lowest level since December, Westpac Banking Corp. and Melbourne Institute survey taken 5-9 March of 1,200 consumers showed today in Sydney. (Bloomberg)
EU: German investor confidence surges to a 21-month high
German investor confidence jumped to a 21-month high in March after the European Central Bank flooded financial markets with cash and the sovereign debt crisis showed signs of abating. The ZEW Center for European Economic Research in Mannheim said today its index of investor and analyst expectations, which aims to predict economic developments six months in advance, advanced to 22.3 from 5.4 in February. That’s the fourth straight increase and the highest reading since June 2010. Economists forecast a gain to 10, according to the median of 36 estimates in a Bloomberg News survey. (Bloomberg)
ECB President Mario Draghi called on banks to make the most of a lull in the sovereign debt crisis and “strengthen their resilience further, including by retaining earnings, cutting dividends and bonuses” as he seeks to get the ECB back to its main job of ensuring price stability. He also exhorted governments to “make further progress on their program of economic reform” as the ECB’s work “needs to be complemented by the work of national policy makers.” (Bloomberg)
Euro-area finance ministers signed off on a second Greek bailout, clearing the way for the first payment from the €130bn package to be made this month. (Bloomberg)
US: Retail sales climb by most in five months
Americans heartened by an improving labour market boosted spending at stores and malls by the most in five months, adding to signs that the world’s largest economy is gaining strength. The 1.1% advance followed a 0.6% increase in January that was larger than previously estimated, according to Commerce Department data issued yesterday in Washington. Sales rose in 11 of 13 categories, including auto dealers and clothing stores, showing gains in demand were broad based. Stocks and bond yields rose as the report indicated that the best six-month streak of employment growth since 2006 is bolstering spending even as gasoline costs rise. Job gains have not been large enough to satisfy Federal Reserve officials, who today reaffirmed a commitment to keep interest rates low. (Bloomberg)
US: Fed says labour market improves, leaves policy unchanged
Federal Reserve policy makers raised their assessment of the economy as the labour market gathers strength and refrained from new actions to lower borrowing costs. “The unemployment rate has declined notably in recent months but remains elevated,” the Federal Open Market Committee said in a statement at the conclusion of a meeting yesterday in Washington. It also said, “strains in global financial markets have eased, though they continue to pose significant downside risks to the economic outlook”. (Bloomberg)
The US Federal Reserve said 15 of the 19 largest US banks could maintain adequate capital levels even in a severe recession scenario that assumes they continue to pay dividends and buy back stock. The Fed said an unemployment rate of 13%, a 50% drop in stock prices and a 21% decline in house prices under the stress scenario would produce aggregate losses of US$534bn over nine quarters, but the 19 banks would see their tier one common capital ratio only falling to 6.3% in 4Q13, above the 5% minimum the Fed required (10.1% in 3Q11). (Bloomberg)
The US budget deficit this year will swell by an additional US$92bn from estimates made in Jan to US$1.171tr after Congress later extended a payroll tax cut without reducing spending elsewhere, the nonpartisan Congressional Budget Office said. (Reuters)
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