China’s non-manufacturing PMI for Dec surged to 56.0 from 49.7 in Nov. (Bloomberg)
Land sales in 130 major Chinese cities dropped 13% yoy in 2011, as property market curbs continued to bite the realty industry, according to the China Index Academy. Land premiums reached Rmb1.86tr (US$295.2bn). (Xinhua)
China: Wen Jiabao foresees ‘relatively difficult’ first quarter
Chinese Premier Wen Jiabao said business conditions may be “relatively difficult” this quarter and monetary policy will be fine-tuned as needed. “We see downside pressure on our economy and elevated inflation at the same time,” Wen said during a two-day trip to Hunan province. “We also face problems of weakening external demand and rising costs for companies.” Economists say the central bank will cut lenders’ reserve requirements before a weeklong Chinese New Year holiday starts on 23 Jan, the second reduction since 2008. (Bloomberg)
South Korea’s foreign reserves declined 0.7% mom in Dec to US$306.4bn (US%308.63bn in Nov). (Bloomberg)
Singapore's GDP shrunk 4.9% qoq in 4Q (1.5% in 3Q), in line with consensus expectations of a 5.0% contraction. GDP expanded 3.6% yoy (5.9% in 3Q), below the median forecast of 4.3% yoy. The economy grew 4.8% in 2011 (14.5% in 2010), below the government's forecast of 5%. (Bloomberg, Reuters)
Singapore’s gross domestic product fell an annualised 4.9% qoq in 4Q11 (a revised 1.5% in 3Q11), the second contraction in three quarters, according to the trade ministry. The median estimate was a 5% contraction. Manufacturing rose 6.5% yoy (13.4% in 3Q11), while the services sector expanded 3.2% (3.7% in 3Q11). (Bloomberg)
The Indonesian government says it will end the sale of subsidised fuel to private cars in Greater Jakarta in Apr, pending approval from the House of Representatives. (Jakarta Post)
The Indonesian government plans to raise Rp53.2tr (US$5.9bn) or 12% yoy more in debt sales this quarter as part of the country’s efforts to plug its budget deficit, the Finance Ministry said. (Jakarta Globe)
President Susilo Bambang Yudhoyono said that Indonesia’ GDP may have grown by 6.5% yoy in 4Q (6.5% in 3Q). (Jakarta Globe)
Meechai Bonyamarn, assistant director-general of the Department of Export Promotion, said the effects of the recent flooding would hit Thai exports with annual growth of just 10% predicted, compared with last year’s projected 15% expansion. (Bangkok Post)
Asia: India, China economies show Asia resilient as Europe falters
Manufacturing in India and China improved in December, a sign the world’s fastest-growing major economies are withstanding Europe’s debt crisis. The Purchasing Managers’ Index in India rose to 54.2, the most in six months, from 51 in November. In China, the index was at 50.3 from 49 in November, the Beijing- based logistics federation said. A number above 50 indicates expansion. In another positive sign, a Chinese index for non- manufacturing industries rose yesterday. (Bloomberg)
Greece may be forced to exit the eurozone if it cannot secure the latest bailout package from the EU, IMF and banks, government spokesperson Pantelis Kapsis warned. (BBC News)
EU: Spain’s registered unemployment rises as economy contracts
Registered unemployment in Spain, where almost half of young people are out of work, rose for a fifth month in December as the euro area’s fourth-largest economy contracted. The number of people registering for unemployment benefits rose 1,897 to 4.42 million, the Labor Ministry in Madrid said. In November, it surged 59,536. Spain’s economy contracted in the final months of the year as tourism and exports, the drivers of its first-half recovery from a three-year slump, weakened; the Bank of Spain said on 29 Dec. Labor Minister Fatima Banez met union leaders and employers last week. Prime Minister Mariano Rajoy asked both sides to reach agreement by around 6 Jan on changes to collective wage-bargaining rules and ways to resolve labor conflicts outside the courts. (Bloomberg)
US: Manufacturing grows by most in six months
US factories expanded in December at the fastest pace in six months, adding to evidence manufacturing is improving from India to the UK entering 2012. The Institute for Supply Management’s factory index climbed to 53.9 last month from 52.7 in November. Fifty is the dividing line between growth and contraction. Stocks surged and commodities rose as the data showed factory orders and production grew at the strongest rates in eight months while inventories were cut. (Bloomberg)
US: Dollar demise exaggerated as 13% gain since ‘08 proves value
Moves by the Federal Reserve to flood the world with dollars are doing little to dent the currency’s value, bolstering the appeal of US assets at a time when the government needs the support of foreign investors the most. The US Dollar Index has appreciated 13% from a record low in March 2008 even as the Fed kept interest rates at about zero and printed cash to buy USD2.3trn of Treasury and mortgage-related bonds, and is little changed since 1991. The International Monetary Fund said 30 Dec that the greenback’s share of global foreign-exchange reserves rose in the third quarter by the most since 2008. (Bloomberg)
The Federal Reserve has announced its plans to commence publishing forecasts on the path of interest rates later this month along with its regular quarterly economic forecasts to better align bets in financial markets with central-bank policymakers’ views. This marks an important milestone in Fed Chief Ben Bernanke’s push for greater policymaking transparency. (Reuters)
US construction spending rose in Nov by 1.2% (a revised -0.2% in Oct), the third increase in four months and exceeding the median estimate of 0.5%. Private construction spending rose 1% mom to US$522bn, the highest level since Dec 09, whilst homebuilding outlays gained 2%. (Bloomberg)
US stocks advance amid signs of growth in global manufacturing
US stocks climbed, sending the Dow Jones Industrial Average to the highest level since July, amid signs that manufacturing output is increasing from China to Australia and America. The Standard & Poor’s 500 Index rallied 1.6% to close at 1,277.06, the highest level since 28 Oct. The Dow jumped 179.82 points, or 1.5%, to 12,397.38, adding to its 5.5% advance in 2011. (Bloomberg)
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