Bank Indonesia will from 15 Jun set a minimum down payment for motor vehicle and housing loans. Banks’ loan-to-value ratio for housing loans has been set at a maximum of 70%. The minimum down payment for loans from commercial banks for motorcycles will be set at 25%, 25% for “productive” vehicles such as buses and at 30% for private auto vehicles. Indonesia's capital market regulator Bapepam will also set minimum down payments for auto loans provided by multi-finance firms, which provide loans for motor vehicles. (Bloomberg)
Indonesia’s government announced that it would most likely increase subsidized fuel prices by Rp1,500 to Rp 6,000 starting from 1 Apr. (Jakarta Post)
Vice President Boediono said Indonesia’s budget deficit in 2012 could surpass 4% of GDP if the government did not do anything in connection to the increasing price of oil. (Antara News)
Singapore’s non-domestic oil exports rose 30.5% yoy in Feb (-2.4% in Jan), higher than market expectations of a 16.2% increase. The headline figure was boosted by electronic exports, which grew 23.3% yoy in Feb (-10.9% in Jan). (Bloomberg)
Thailand’s foreign reserves fell to US$179.1bn in the week ended 9 Mar from US$180bn the previous week. (Bloomberg).
China: Chinese companies forced to falsify data. The statistics bureau said local officials forced some hotels, coal miners and aluminum makers to report false numbers, highlighting flaws in data tracking the world's second-largest economy. Statistics officials in Hejin city in northern Shanxi province gave companies "seriously untrue" numbers to submit for 2011, the Beijing-based National Bureau of Statistics said in a statement on its website dated March 12. (Source: Bloomberg)
China: Home prices post worst performance in a year on curbs
China’s February home prices posted the worst performance in a year with almost half of the cities monitored by the government falling from a year ago as the country maintained curbs on the property market. New home prices fell in 27 of 70 cities last month from a year earlier and prices were unchanged in six cities, the national statistics bureau said. That is the worst since the government began at the start of 2011 releasing individual data for 70 cities instead of a national average. Premier Wen Jiabao said last week housing prices remain far from a reasonable level and called on the government not to slacken efforts to regulate the home sector. Relaxing the curbs could cause “chaos” in the market, Wen said. China’s two-year campaign to rein in home prices has included measures such as higher down payments and mortgage rates, and home purchase restrictions in 40 cities. (Bloomberg)
China new-home prices fell on a mom basis in Feb in 45 out of 70 large and mid-sized cities tracked by the government, down from 48 in Jan. Just four cities experienced price rises. (AFP)
India: Sets modest path to trim deficit
The Indian government played it safe in unveiling its 2012/13 budget, pledging reforms but setting only modest targets for trimming a ballooning fiscal deficit, disappointing bond market investors. India's Congress party-led government has been battered by a series of setbacks that curtailed its ability to implement reforms and curb populist spending. The finance minister, Pranab Mukherjee set a fiscal deficit target of 5.1% of GDP for the fiscal year that begins in April, down from an expected 5.9% in the current year. This year's figure, however, ended up far above the 4.6% it had originally targeted in its budget a year ago. Mukherjee said he expected India's economy to grow by 7.6% in the next fiscal year, up from an expected 6.9% in the current year but below the 8.4% growth in the previous fiscal year. (StarBizWeek)
EU: Lagarde says world can’t be lulled into sense of security
International Monetary Fund Managing Director Christine Lagarde urged policy makers to be vigilant as oil prices, debt levels, and the risk of slowing growth in emerging markets threaten global economic stability. “Optimism should not give us a sense of comfort or lull us into a false sense of security,” Lagarde said at a speech in Beijing. “We cannot go back to business as usual.” The IMF last week approved a EUR28bn (USD36.6bn) loan for Greece as part of a EUR130bn second bailout by the European Union that requires more austerity and an overhaul of its economy. Greece completed the world’s largest sovereign-debt overhaul and agreed to deeper spending cuts to obtain new funds as it faces a fifth year of recession. “The measures that were proposed are ambitious and it will be important to focus on steady rigorous implementation of the situation on the ground,” Lagarde said about Greece. (Bloomberg)
UK: Will keep austerity with unemployment at 16-year high
“Britain won’t ease austerity in its budget to be presented this week, and we are going to stick with the deficit reduction plan that I set out almost two years ago,” UK Chancellor of the Exchequer George Osborne said. UK. Jobless claims rose more than economists forecast in February, and a broader measure of unemployment remained at the highest level in 16 years, according to data released 14 Mar by the Office for National Statistics in London. Keeping austerity measures in place is important “to provide the stability that the British economy needs and the low interest rates the British economy needs to allow the recovery to take hold,” Osborne added. “The plan we put in place is bringing that deficit down and borrowing is coming down, but even with that, we still have one of the highest budget deficits in the world,” he said. (Bloomberg)
Some Bank of Japan board members expressed concerned that increased bond purchases by the central bank may be viewed as financing government deficit spending and as such it was important “to clearly recognize and explain to the public” that bond purchases are not “for the purpose of monetization,” according to minutes of last month’s meeting. (Bloomberg)
Japan and 12 other Asian countries will likely agree to double the amount of funds available under a regional currency swap pact amid uncertainty over the European debt crisis, according to Japan’s Nikkei daily who cited unnamed sources. (AFP)
Japan’s final reading of the leading index stood at 94.4 (prior reading was 94.9), whilst the coincident index retreated to 93.0 from the prior 93.1. (International Business Times)
IMF chief Christine Lagarde said measures taken to fight financial woes in Europe and the US were starting to pay off, whilst China should continue to move away from its dependency on exports and investment to focus more on domestic consumption. (AFP)
Spain: Public-debt burden surged to the most in at least two decades, underlining concerns about its ability to reorder state finances as contagion from the debt crisis focuses on the euro area's fourth-biggest economy. The nation's overall debt last year amounted to 68.5%t of GDP, exceeding the government's forecast of 67.3%, data on the Bank of Spain's website showed. That compares with 66% in the third quarter and 61.2% at the end of 2010. (Source: Bloomberg)
Eurozone exports rose 11% yoy in Jan to bring the bloc's trade deficit to €7.6bn, down from €16.1bn in Jan 2011. (The Guardian)
US industrial production was unchanged in Feb (a revised 0.4% mom in Jan), falling short of consensus expectations of a 0.5% rise due to a drop in mining and flat utilities. Capacity utilisation fell marginally to 78.7% (a revised 78.8% in Jan), in line with consensus, whilst manufacturing fell to 0.3% mom (a revised 1.1% in Jan), close to median expectations of 0.5%. (Bloomberg)
US: Consumer prices rose in February as gasoline jumped
The cost of living in the US rose in February by the most in 10 months, reflecting a jump in gasoline that failed to spread to other goods and services. The consumer-price index climbed 0.4%, after increasing 0.2% the prior month, the Labor Department said. The biggest jump in gasoline in more than a year accounted for about 80% of the increase in prices last month, leaving households with less money to spend on other goods and services. Federal Reserve policy makers say the advance in fuel costs will be temporary, and most see little risk inflation will flare out of control as unemployment exceeds 8%. (Bloomberg)
U.S: Consumer sentiment dropped in March as this year's 17% jump in gasoline prices threatens to squeeze household budgets. The Thomson Reuters/University of Michigan preliminary index of consumer sentiment fell to 74.3, the lowest this year, from 75.3 the prior month. A government report showed that consumer prices rose in February by the most in 10 months, with gasoline accounting for 80% of the increase. (Source: Bloomberg)
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