20110713 1057 Local & Global Economic Related News.

Malaysia’s nuclear plan on the back burner
Malaysia’s nuclear aspirations have been put on the back burner, but the machinery is still in place according to Energy Commission chairman Tan Sri Ahmad Tajuddin Ali. Speaking to reporters at the Third Energy Forum yesterday, Tajuddin said, “Originally, under the ETP, it was planned that the first 1,000MW of nuclear power would be available by 2021. However, post-Fukushima it is expected that the deadline will not be met. At the moment, the government hasn’t made a decision, but it should be kept in mind that non-decision means automatic deferment”. (Financial Daily)

U.S. Trade deficit in May unexpectedly surges as oil prices climb. The gap grew 15% MoM to USD 50.2b, exceeding all forecasts. Exports held near April's record. (Source: Bloomberg)

U.S: Small-business index fell in June to nine-month low, led by weakening sales expectations and dimming views on the economy, a private survey showed. The National Federation of Independent Business's optimism index decreased to 90.8 from 90.9 in May. The June reading was the lowest since September. (Source: Bloomberg)

U.S: Fed officials divided on more stimulus if growth stays weak, minutes of their meeting last month showed. "A few members noted that, depending on how economic conditions evolve, the committee might have to consider providing additional monetary stimulus, especially if economic growth remained too slow to meaningfully reduce the unemployment rate in the medium run," the Federal Open Market Committee said in the minutes of its June 21-22 meeting, released in Washington. (Source: Bloomberg)

Ireland: Rating cut to junk as EU seeks to contain debt crisis. Ireland joined Portugal and Greece as the third euro-area nation to have its credit rating reduced to below investment grade as European Union finance ministers struggle to contain the region's sovereign debt crisis. Moody's Investors Service cut Ireland to Ba1 from Baa3, citing the probability that Ireland will need additional official financing and for investors to share in losses before it can return to the private market to borrow. The outlook remains "negative," Moody's said in a statement. (Source: Bloomberg)

Greece: Defaulted Greece may have to rescue Trichet as ECB stands firm
European Central Bank President Jean-Claude Trichet might need to rely on Greece for assistance if the nation defaults. Trichet’s threat to refuse defaulted Greek bonds as bank collateral for ECB liquidity remains in force after European finance ministers failed to agree on measures to stem the region’s debt crisis. In a default, Greek lenders could instead get Emergency Liquidity Assistance, a short-term loan program by national central banks in use in Ireland, said economists at Deutsche Bank AG, Barclays Capital, and BNP Paribas. That would leave the Greek central bank to firefight a banking crisis that Trichet has staked the ECB’s credibility on keeping clear of. The danger of such an event has gained prescience as persisting speculation on the prospect of Greece defaulting transformed into regional contagion that sent bond yields soaring and stocks plunging from Portugal to Italy.(Bloomberg)

China: Money supply growth, new lending rebound in June and foreign-exchange reserves jumped by USD 153b in 2Q11. New loans were CNY 633.9b (USD 98b). M2, the broadest measure of money supply, rose by a more-than-forecast 15.9% YoY, and foreign-exchange reserves climbed to USD 3.2tr. (Source: Bloomberg)

China: Yuan intervention eases as slowdown curbs inflows
China’s central bank bought the fewest dollars in four months to stem gains in the Yuan in June as a slowdown in the world’s second-largest economy damped capital inflows and reduced pressure for the currency to appreciate. The People’s Bank of China’s purchases of foreign exchange from the nation’s lenders totaled CNY277.3bn (USD42.8bn), 26% less than in May, according to data released. The nation’s foreign reserves rose USD152.8bn in the second quarter, the least in a year, and government data is forecast to show gross domestic product increased at the slowest pace since 2009. Expansion is cooling after policy makers raised interest rates three times this year and lenders’ reserve-requirement ratios on six occasions, seeking to tame the fastest inflation since 2008. (Bloomberg)

India: Industrial production growth unexpectedly slowed in May after the central bank extended the longest stretch of interest-rate increases in a decade. Output at factories, utilities and mines rose 5.6% YoY following a revised 5.8% YoY gain in the previous month. (Source: Bloomberg)

Indonesia: Central bank kept its benchmark interest rate unchanged for a fifth consecutive month as easing inflation gives policy makers room to assess the risk of a slowdown in global growth. Bank Indonesia maintained its reference rate at 6.75%, it said in Jakarta. (Source: Bloomberg)

Philippine: Exports unexpectedly decline in May as electronics slump. Exports unexpectedly fell for the first time in 19 months as electronics sales dropped, echoing an easing in demand seen across the region. Shipments abroad declined 3.2% YoY to USD 4.1b. (Source: Bloomberg)