Malaysia: CPI up moderately on food and non-food items
Malaysia‟s March CPI didn‟t bear surprises, with a moderate increase of 2.1% to 104.5 y-o-y. The index for food and non-alcoholic beverages and non-food showed increases of 2.9% and 1.7% y-o-y respectively for March. The CPI remained unchanged at 104.5 m-o-m. The CPI for 1Q2012, meanwhile, rose 2.3% y-o-y. All main groups advanced with the exception of communication, clothing and footwear. Food and non-alcoholic beverages, in particular, rose 3.6%. (StarBiz)
Leading index rose 2.9% yoy in Feb (0.5% yoy in Jan). Coincident index and lagging index recorded a growth of 3.4% yoy and 5.2% yoy respectively in Feb (-0.6% yoy and +3.8% yoy respectively in Jan). (Department of Statistics)
Bank Negara Malaysia's (BNM) international reserves totalled RM416.6bn (US$135.8bn) as at 13 Apr, up slightly from RM416.1bn (US$135.7bn) as at 30 Mar. The reserves are sufficient to finance 9.5 months of retained imports and was four times the short-term external debt. (BNM)
Malaysia is on track to achieve another breakthrough year in medical tourism this year, Tourism Minister Datuk Seri Dr Ng Yen Yen said on 22 Apr. She said receipts from foreign patients spending on medical treatment in Malaysia totalled RM509.8m, based on 578,403 patients last year. These figures were well above the initial projection of RM431m, she said. (Bernama)
Indonesia: S&P sees policy slippages as it considers rating
Indonesia‟s push to lure investment is at risk from “policy slippages” such as the failure to cut fuel subsidies, said Standard & Poor‟s, the only company with a non-investment-grade rating for the Southeast Asian nation. If the government‟s subsidy spending alters the fiscal outcome or markedly deteriorates the quality of expenditure or if policy measures deter fresh foreign direct investment, then the ratings could stabilize at the current level, according to S&P. Indonesian lawmakers last month rejected the government‟s proposal for a 33% increase in subsidized-fuel prices from 1 April, instead allowing it to raise rates only if the Indonesia Crude Price exceeds the state budgetary assumption of USD105 a barrel by 15% over a six-month period. (Bloomberg)
Indian Finance Minister Pranab Mukherjee said it was "not possible" to cut interest rates further, despite calls by industry to slash further to boost domestic investment and kick-start economic growth. (WSJ)
Thailand’s foreign-exchange reserves rose 0.06% wow to US$178.6bn last week (US$178.5bn in the earlier week). The Bank of Thailand’s holdings of forward contracts rose 1.4% wow to US$29.5bn (US$29.1bn a week earlier). (Bloomberg)
Thailand’s Department of Industrial Promotion is set to inspect the condition of the flood-affected factories and their production process in order to prevent any impact on the manufactured goods. (Thai Financial Post)
Thailand’s government turned down the private sector’s request for postponement in the implementation of the minimum wage hike policy to 2015, reasoning that the policy will enhance the competitiveness of the Thai workforce. (Thai Financial Post)
China’s decision to widen the yuan’s trading band against the dollar means investors can play a bigger role in determining the value of the currency, People’s Bank of China deputy Governor Yi Gang said. (Bloomberg)
The flash reading of the MNI China Business Sentiment Survey rose 0.59% mom to 55.40 in Apr (54.81 in Mar), with new orders growing 2.77% mom to 65.87 (63.10 in Mar), whilst production contracted 0.05% mom to 58.62 (58.67 in Mar). (Bloomberg)
Japan: Lacking fiscal plan may be deflation cause
Japan‟s absence of “concrete reform plans” for the nation‟s finances may be contributing to deflation and sluggish economic growth by discouraging spending by the public on concerns over future fiscal developments, central bank Governor Masaaki Shirakawa said. Shirakawa has pledged to extend “powerful” easing until a 1% price goal is in sight and his policy board next meets on 27 April. The nation‟s borrowings will exceed JPY1,000trn (USD12.4trn) for the first time in this fiscal year, the Finance Ministry projects, while the OECD predicts Japan‟s public debt will reach 219% of GDP. (Bloomberg)
Japan: Loan demand rising a boost for recovery
Demand for loans from Japanese companies, households, and local governments rose in the first quarter as the nation‟s economy rebounded from a contraction in 2011. An index showing companies‟ demand climbed to 6 from minus 2 in the previous three months, while gauges for local governments and households jumped to 7 from zero. The figure adds to evidence that Japan is recovering from last year‟s earthquake, tsunami and nuclear disaster. The Bank of Japan‟s setting of a 1% inflation target and expansion of its asset-purchase program by JPY10trn (USD122bn) in February caused the yen to weaken, helping exporters. (Bloomberg)
Japan confirmed it will take steps to forgive about ¥300bn of Myanmar's debt and resume full-fledged development aid as a way to support the country's democratic and economic reforms. (AP)
Japan pledged ¥600bn in development aid to support infrastructure projects in five Southeast Asian nations that share the Mekong River, i.e. Thailand, Vietnam, Cambodia, Laos and Myanmar. (Bloomberg)
Japan’s tertiary industry index was unchanged on a mom basis in Feb (-0.6% in Jan), coming short of consensus expectations of a 0.7% rise. (RTTNews)
South Korea’s government debt could surge above 100% of the country’s annual GDP by 2030 from just a little more than 34% now, the Bank of Korea said in a report. (Reuters)
The IMF raised US$430bn in new funds for crisis intervention Friday, with China and other emerging economic giants taking part despite worries the money will go to more eurozone bailouts. (AFP)
ECB officials led by President Mario Draghi resisted calls from the IMF and US Treasury to do more to stem the debt crisis roiling the euro-area economy, arguing that they had done enough by cutting interest rates and issuing more long-term bank loans. (AFP, Bloomberg)
EU: Governments urged to fix crisis as G-20 warns of rising stress
Europe‟s governments were told the onus for fixing their debt woes lies with them as the Group of 20 warned the two-year crisis still threatens global growth. Canada and Australia joined the IMF and US in pressing Europe to intensify efforts to quell the turmoil as it spreads to Spain. The G-20 cited “the situation in Europe” first in a list of drags on the world economy. (Bloomberg)
UK: March retail sales surge on warm weather
UK retail sales rose at the fastest pace for more than a year last month as the warmest March for half a century boosted purchases of clothing and gardening products and panic buying lifted auto-fuel demand. Sales including auto fuel gained 1.8% from February, when they fell 0.8%. The data add to evidence that the economy returned to growth in the first quarter, though the outlook remains fragile as inflation outpaces wages, continuing the squeeze on household budgets. Sales were boosted by the warmest March since 1957, increasing demand for clothing and footwear and spending at garden centers. Fuel sales rose 4.9% from February. Sales at non-food stores rose 3%, with clothing sales climbing 2.3% and purchases at department stores increasing 1.6%. (Bloomberg)
Germany should give up its dogged opposition to eurobonds now that all EU members have signed a fiscal treaty, the IMF chief economist Olivier Blanchard said. (AFP)
US: Consumer spending probably paced growth
The biggest gain in consumer spending in a year probably helped the US economy keep expanding in the first quarter even as fuel costs climbed. GDP is expected to rise at a 2.5% annual rate after advancing 3% in the previous three months. The Commerce Department will release the figure on 27 April. Consumer purchases that account for about 70% of the economy climbed by the most since the end of 2010, the survey of economists showed. Job creation and warmer winter weather helped Americans overcome higher prices at the gas pump as auto sales powered ahead and retailers enjoyed more foot traffic. At the same time, the pace of growth may not be enough to convince Federal Reserve policy makers meeting this week to stray from their plan to keep borrowing costs low through 2014. (Bloomberg)
US Treasury Secretary Timothy Geithner told his Indian counterpart Finance Minister Pranab Mukherjee that US businesses have become worried about changes in India's tax regime for foreign companies. (AFP)
US Treasury Secretary Timothy Geithner said the global economic recovery is fragile amid risks from the eurozone and higher oil prices, and Europe’s effort to prevent the spread of its debt crisis depends on the willingness and ability of the region’s leaders to act aggressively and creatively. (Bloomberg)
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