E.U: ECB bond purchases drop to lowest in almost two months. The Frankfurt-based ECB said it completed EUR 603m (USD 794m) of purchases after settling EUR 2.667b the previous week. It will take seven-day term deposits to neutralize EUR 72.5b of liquidity created by bond purchases since the program started on May 10, it said. (Source: Bloomberg)
E.U: ECB expresses 'serious concerns' about Irish bank proposals. The European Central Bank said it has "serious concerns" that legislation introduced by the Irish government to fix its banking system threatens the ECB's ability to run its liquidity operations. "The ECB has serious concerns that the draft law is insufficiently legally certain," the central bank said in a position paper published on its website. The Irish law should not hurt the ability of euro-region monetary authorities "to enforce their rights including, without limitation, the enforcement of security over any eligible collateral posted by any relevant institution." (Source: Bloomberg)
Portugal: Says budget deficit narrows for first time this year. The budget gap narrowed to EUR 12.94b about EUR 100m less than in the same period last year. Spending rose 2.6%, a pace that's 0.2ppts slower than recorded for the 10 months through October. Tax revenue increased 5% YoY. (Source: Bloomberg)
Taiwan: Export orders in November gained more than estimated. Orders, an indication of shipments in the next one to three months, increased 14.34% YoY in November after a 12.26% YoY climb in October. (Source: Bloomberg)
Crude Oil: Trades close to 2-year high as cold boosts heating demand. Temperatures in Europe and parts of the U.S. are colder than usual, boosting same-day U.K. natural gas prices by as much as 14%. Crude for January delivery gained 63 cents to USD 88.65/bbl. The more actively traded February contract advanced 51 cents to USD 89.11/bbl. (Source: Bloomberg)
Taiwan: Export orders increase more than estimated
Taiwan’s export orders gained more than estimated, supporting the case for the central bank to raise borrowing costs this month for the third time since the start of the year. Orders, an indication of shipments in the next one to three months, increased 14.3% in November from a year earlier, after a 12.3% climb in October, the Ministry of Economic Affairs said in Taipei today. The median estimate survey was for an advance of 13.3%. (Bloomberg)
South Korea: Imposes bank levy to reduce volatility
South Korea unveiled measures to guard against sudden capital outflows as military tensions with the North raised concerns investors will pull funds out of Asia’s fourth-largest economy. The government said yesterday it aims to apply a levy on banks’ foreign-exchange borrowings, will strengthen punishment for inappropriate reporting of currency trades and may tighten rules on derivatives. It is considering a 20 basis-point levy on overseas debt maturing in less than one year, Vice Finance Minister Yim Jong Yong said. (Bloomberg)
Spain: Regions’ nine-month budget deficit reaches 1.24% of GDP
Spanish regional governments posted a combined nine-month budget deficit of 1.24% of GDP, and the 17 regions will meet a full-year goal of a budget shortfall of 2.4% of GDP, the Finance Ministry said. Spanish regions, with EUR107.6bn (USD142bn) of outstanding debt, control health and education spending and hire half of all public workers. (Bloomberg)
UK: BOE forecast to raise interest rate within six months
The Bank of England will start raising interest rates within six months to curb inflation, the Confederation of British Industry said. The Monetary Policy Committee will increase its benchmark interest rate by a quarter-point every three months from the second quarter of 2011 until mid-2012, the London-based group said. It will then step up the pace of increases to end that year with a rate of 2.75%. (Bloomberg)
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