Singapore: Singapore inflation accelerates to fastest since January on food, housing
Singapore’s inflation accelerated to the fastest pace since January as food and housing costs increased, sustaining pressure on the central bank to allow the currency to appreciate and contain price gains. The consumer price index rose 5.2% last month from a year earlier, the Department of Statistics said in a statement today. That matched the median estimate of 13 economists surveyed by Bloomberg News. Inflation was 4.5% in May, according to previously reported data. The Monetary Authority of Singapore raised its inflation forecast for 2011 last week, citing higher home rental and transportation costs. (Bloomberg)
Asia: Growth may slow in South Korea and Taiwan on exports
Growth in South Korea and Taiwan likely slowed in the second quarter as the debt crisis in Europe and faltering US growth weighed on Asia’s exports. South Korea’s gross domestic product expanded 3.5% from a year earlier, less than the 4.2% gain in the previous quarter, according to the median estimate in a Bloomberg News survey of 11 economists. Taiwan’s growth likely slowed to 4.5% from 6.55%, a separate survey showed. This week’s reports may add to signs that growth across Asia is cooling after China reported a smaller expansion, India’s industrial production eased and Singapore’s economy contracted. (Bloomberg)
India: India’s central bank signals higher rates for ‘unfinished’ inflation task
India’s central bank said curbing inflation remains an “unfinished task” even as economic growth slows, signaling it may raise interest rates today. “The policy exigency at this juncture warrants continuation of anti-inflationary stance,” the Reserve Bank of India said in a report yesterday before its policy meeting in Mumbai. The RBI cited a high share of production capacity in use, risk of a “wage-price spiral” and “stickiness” in food costs adding to price pressures. The report followed signs of a clash between economists and bond traders over whether the RBI would keep increasing borrowing costs after today’s projected move of a quarter point in the benchmark rate. (Bloomberg)
UK: UK house prices decline 0.1% as downward trend continues, Hometrack says
UK house prices fell for a third month in July and are likely to continue on a “downward trend,” property researcher Hometrack Ltd. said. The average cost of a home slipped 0.1% from June and was down 3.9% from a year earlier, the London-based firm said in an e-mailed report today. London prices increased 0.3% on the month. In a separate report, Rightmove Plc, the UK’s biggest property website, said a growing proportion of consumers expect prices to stabilize over the next 12 months. Home values have fallen this year as weak demand undermined prices, Hometrack said. While the market is now in “broad equilibrium” and the Bank of England’s key interest rate remains at a record low, prices will remain under pressure, it said. (Bloomberg)
EU: Greece rating cut to second-lowest level by moody’s on ‘orderly default’
Greece’s credit rating was cut three steps by Moody’s Investors Service, which said the European Union’s rescue for the debt-laden nation will cause substantial losses for investors and amount to a default. Greece’s long-term foreign currency debt was downgraded to Ca, its second-lowest rating, from Caa1, the company said in a statement in London today. Moody’s said it will reassess the risk profile of any outstanding or new securities issued by Greece after the debt exchange that’s part of the new rescue plan has been completed.. (Bloomberg)
US: Reid, Boehner offer competing plans to raise debt ceiling
House Speaker John Boehner and Senate Majority Leader Harry Reid attacked each other’s plans for Congress to lift the US’s USD14.3trn debt ceiling and avert default before a 2 Aug deadline. President Barack Obama plans to address the nation from the White House at 9 p.m. Washington time on the partisan standoff, the administration announced. Boehner’s two-step plan would raise the US borrowing limit by up to USD1trn and later by USD1.6trn while requiring larger spending cuts. It could be voted on in the House within two days. (Bloomberg)
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