Asian Stocks Rise for Third Week on Improved China, U.S. Economic Data
Asian stocks rose for a third week, its longest streak of weekly advances since July, as manufacturing growth from China to the U.S. stoked optimism the global economy will withstand Europe’s sovereign-debt crisis. (Bloomberg)
Thailand: To tap lenders, central bank to service 1997 debt
Thailand is set to raise fees on commercial banks as the government prepares to tap collections from lenders and central bank profits for USD2bn in annual interest payments on bailout debt from 1997. A government decree will shift responsibility to repay the THB1.1trn (USD35bn) debt to a central bank agency while keeping the principal on the finance ministry’s books, according to Attaporn Jarujinda, secretary-general of the Council of State, the government’s legal advisory body. While repayments can draw on central bank profits, they won’t involve foreign reserves or prompt it to print money, he said. (Bloomberg)
China: December lending, money supply signal easing conditions
China’s December lending and money supply growth exceeded economists’ estimates, signaling monetary conditions may be easing as the nation’s central banker said it must be prepared for possible shocks from the US and Europe. New loans totaled CNY640.5bn (USD101bn) for the month, exceeding the estimates of all 18 economists surveyed by Bloomberg. M2, a measure of money supply, rose 13.6%, compared with the 12.9% median of 18 estimates. People’s Bank of China Governor Zhou Xiaochuan said the nation must be ready to combat possible shocks from Europe’s debt crisis and an uncertain US economic outlook. (Bloomberg)
India: Singh says economy will grow about 7% this fiscal year
Prime Minister Manmohan Singh said India’s economy will grow about 7% in the year ending Mac 31, less than his December prediction of 7.5%. However, he said that the government hopes to bring back the rhythm of our growth processes to sustain an annual growth rate of 9% to 10% in the medium-term. (Bloomberg)
Taiwan: Presidential candidates vow taxes to contain prices
Taiwan’s presidential candidates have vowed to rein in property prices by imposing new taxes, making surging housing values a key political issue. President Ma Ying-jeou, the Kuomintang party chairman who is seeking re-election on 14 Jan, and opposition Democratic Progressive Party chairwoman Tsai Ing-wen both said they would introduce a capital gains tax on transactions of properties to curb speculative buying. Tsai plans to draft the law within a year. The new taxes will add to Ma’s earlier efforts to fight real-estate speculation that led housing prices in the capital Taipei to more than double since 2000 and reach a record high in September. (Bloomberg)
New Zealand: Trade deficit widens on imports as exports rise
New Zealand’s trade deficit widened in November as crude oil and fertilizer purchases bolstered imports. Exports gained for a third month. Imports exceeded exports by NZD308mn (USD240mn), from a revised NZD228mn deficit in October, Statistics New Zealand said in Wellington. Rising imports add to signs of improving domestic demand before an expected acceleration in the second half this year led by rebuilding of earthquake-devastated Christchurch. Exports are increasing as the New Zealand dollar’s 6.8% decline the past six months offsets the effect of weaker global commodity prices. (Bloomberg)
EU: Hungary’s Orban receives warning from European People’s Party
Hungarian Prime Minister Viktor Orban’s ruling Fidesz group was warned that the European People’s Party will back the European Commission in a dispute over domestic legislation that prompted a breakdown in financial aid talks. The Commission and the International Monetary Fund suspended bailout negotiations with Hungary in December, saying that a newly passed central bank law may curb monetary policy independence. Orban rejected a written request from European Commission President Jose Manuel Barroso to withdraw the central bank bill and a law on financial stability. (Bloomberg)
U.K. Stocks Gain as U.S. Data Boosts Confidence; Vodafone, ITV Shares Rise
U.K. stocks climbed, snapping a two- day selloff, as a U.S. report showed unemployment fell to a near threeyear low, boosting confidence in the recovery of the world’s largest economy. The benchmark FTSE 100 Index gained 25.42, or 0.5 percent, to 5,649.68 at the close in London, extending this week’s increase to 1.4 percent. The broader FTSE All-Share Index rallied 0.5 percent, while Ireland’s ISEQ Index was unchanged. (Bloomberg)
Belgium Freezes $1.7 Billion of Spending After EU Warns of Deficit Overrun
Belgium froze 1.3 billion euros ($1.7 billion) in spending after the European Union warned that a weaker-thanprojected economy would push the deficit above the new government’s targets. Belgium, saddled with Europe’s fifth-highest debt, is battling to prevent a surge in borrowing costs amid domestic economic hardships and investors’ broader skepticism about the euro area’s response to the two-year-old debt crisis. (Bloomberg)
US: Obama re-election odds may rise as unemployment falls
President Barack Obama called last Friday’s jobs report a sign the US economy is on the rebound. The drop in the unemployment rate in December to 8.5%, showed the job market gaining momentum heading into a presidential election campaign that will be shaped by the state of the economy. The Labor Department figures cap four months of declines in the unemployment rate and six consecutive months of jobs gains of 100,000 or more. Employers expanded payrolls by 200,000 in December. For all of 2011, 1.64 million positions were created, the most since 2006, after a 940,000 increase in 2010. (Bloomberg)
U.S. Stocks Rise as S&P 500 Index Posts Its Second-Best Start Since 2006
U.S. stocks rose last week, sending the Standard & Poor’s 500 Index to its second-best start of a year since 2006, as reports on manufacturing from America to China bolstered optimism about the global economy. The S&P 500 climbed 1.6 percent to 1,277.81 in the first four trading days of the year, the second-best start in the past six years after a 2.4 percent gain in 2010, according to data compiled by Bloomberg. The Dow added 1.2 percent, or 142.36 points, to 12,359.92 for the week. (Bloomberg)
U.S. Unemployment Falls to 8.5% as Jobs Gain
Payroll growth in the U.S. beat forecasts in December and the unemployment rate dropped to the lowest level in almost three years as the economy gained strength heading into 2012. The 200,000 increase followed a revised 100,000 gain in November that was smaller than first estimated, Labor Department figures showed today in Washington. The jobless rate unexpectedly fell to 8.5 percent, while hours worked and earnings climbed. (Bloomberg)
IMF: To make ‘substantial’ cut in global economic forecast
Olivier Blanchard, the IMF’s chief economist said IMF will make a “fairly substantial” cut to its forecast for global economic growth this year. In September, the Washington-based fund lowered its forecast for global growth to 4% in 2012 and warned of “severe” repercussions if Europe failed to contain its sovereign debt crisis. Blanchard also said overall world growth will probably be “not very far” from 3% to 4%, adding Europe is “very close to zero at this point” while the U.S. is in better shape than many other nations. (Bloomberg)
IEA: Has no immediate plan to release oil stockpiles on Iran
The International Energy Agency, the adviser to U.S., Germany and Japan, isn’t planning an immediate release of emergency oil stockpiles in response to the tension in the Middle East. The organization said as there is no specific supply disruption is under way, they are not actively considering any action at the present time. Crude oil gained over the last three weeks, partly on concern that Iran may close the Strait of Hormuz at the mouth of the Persian Gulf. The waterway carries about 17 m barrels of oil a day, according to the U.S. Energy Department. That’s about 19% of global consumption. (Bloomberg)
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