20110208 0943 Global Economic Related News.

Indonesia: Economy grows at fastest pace in six years
Indonesia’s economy grew at the fastest annual pace in six years last quarter, adding to the case for the central bank to raise interest rates further as inflation accelerates. GDP increased 6.9% y-o-y in the three months through December, beating the 6.3% median estimate. The absence of a harvest led to a 1.4% economic contraction q-o-q. Private consumption contributed 2.7 ppt to GDP growth in 2010, while investment accounted for about 2 ppt. Consumer confidence rose in January m-o-m, with a central bank index climbing 4.6 points to 113.9, the highest level since August 2009. Consumer-price growth accelerated to 7.02% in January, from 6.96% in December. (Bloomberg)

India: Government predicts fastest economic growth since 2008
India’s government predicted the economy will expand 8.6% y-o-y in the year ending 31 March, the most in three years, supporting the central bank’s case for raising interest rates further after the steepest increases in Asia. Reserve Bank of India (RBI) on 25 Jan raised the key repurchase rate by 0.25% to a two-year high of 6.5% and boosted the nation’s inflation forecast. The central bank said India’s benchmark wholesale-price inflation rate may be at 7% by 31 March, more than the 5.5% earlier estimate. The gauge stood at 8.43% in December. RBI maintained their growth projection for the current financial year at 8.5% with an “upward bias.” (Bloomberg)

Australia: Retail sales rise less than forecast
Australian retail sales rose less than economists expected in December, sending the currency lower as consumers spent less at department stores and more on clothing and footwear. Sales advanced 0.2% over the period incorporating Christmas, after a revised 0.4% gain in November. That was less than the median forecast for a 0.5% increase. Spending on clothing and footwear climbed 2.7% and consumers spent 1.5% more on household goods. They spent 1.2% less at department stores. Retail sales, adjusted to remove inflation, fell 0.3% q-o-q in the three months through 31 Dec, matching estimates. (Bloomberg)

EU: German factory orders fell in December
German factory orders fell in December after jumping five times more than economists expected in the previous month. Orders, adjusted for seasonal swings and inflation, dropped 3.4% m-o-m after they surging 5.2% previously. Orders climbed 19.7% y-o-y, when adjusted for working days. Domestic factory orders fell 2.4% in December and foreign orders declined 4.2%, driven by an 8.9% slump in demand from outside the euro area. Orders for investment goods dropped 6.6% after November’s 8.8% gain. Orders for consumer goods eased 0.1% while sales of basic goods rose 0.6%. (Bloomberg)

US: Consumer credit increases for third month
US consumer borrowing rose in December for a third consecutive month, led by the first increase in credit-card charges in more than two years as holiday sales improved. Credit rose by USD6.1bn to USD2.41trn after increasing a revised USD2.02bn in November. Economists projected a USD2.4bn increase. Borrowing remains below the peak of USD2.58trn in July 2008. For all of 2010, credit contracted by 1,6% after falling 4.4% in 2009. Revolving debt rose USD2.32bn in December, the first gain since August 2008. Non-revolving debt rose USD3.78bn, the fifth consecutive increase. (Bloomberg)