Malaysian exports experienced a slight decline in April for the second consecutive month due to weakening demand. Exports fell 0.1% y-o-y to RM57.7bn due to lower exports to the EU and most East Asia countries. The country also saw its trade surplus slump 31.8% from RM11.0b a year ago to RM7.5bn. (Malaysian Insider)
The staggering RM109.67bn in taxes collected by the Inland Revenue Board (IRB) last year is unlikely to be repeated this year, said IRB CEO Tan Sri Dr Mohd Shukor Mahfar. The collection was extraordinary and was RM23bn more than what was collected in 2010 (RM86bn), he said. “If indeed it is, it could mean something was wrong with the collection in the previous years,” he said. Nevertheless, the board aims to collect around RM110bn in taxes this year. (The Star)
China's overseas investment surged in the first quarter to US$21.4bn as state-owned companies snapped up resource-related assets around the globe. That figure includes mergers and acquisitions as well as greenfield investments, or construction of new plants and facilities. (WSJ)
Sales in 34 out of 40 large Chinese cities monitored across the country have seen a month-on-month increase from Apr to May, according to the SouFun report. (China Daily)
China is likely to announce a cut in gasoline and diesel prices for a second time this year as early as Friday after a fall in global fuel prices passed the 22-working-day review period. (Global Times)
China's banking regulator has noticed a contradiction between a surge in some categories of problematic loans on the one hand and a decline in non-performing loan ratios over the past few months, and it is taking a closer look at lenders' loan classification. (China Daily)
China: Services industry expanded at a faster pace in May, according to a survey of purchasing managers released by HSBC Holdings Plc and Markit Economics. The PMI rose to a 19-month high of 54.7 in May from 54.1 in April, HSBC and Markit said. (Source: Bloomberg)
India: Service-industry growth quickens to a three-month high in May. The purchasing managers' index climbed to 54.7 from 52.8 in April, HSBC Holdings Plc and Markit Economics said. A number above 50 indicates growth. (Source: Bloomberg)
Taiwan: Inflation accelerated for a third month in May on higher food prices, reducing room to cut interest rates and support a slowing economy. The consumer-price index climbed 1.74% YoY, compared with a 1.44% YoY increase in April, the statistics bureau said. (Source: Bloomberg)
Thailand: Confidence falls in May on inflation, political concerns. An index measuring sentiment fell to 67.1 from 67.5 in April, the University of the Thai Chamber of Commerce said. The gauge is based on a survey of 2,241 respondents. (Source: Bloomberg)
Philippines: Inflation eased in May, giving the central bank room to cut interest rates should Europe's debt crisis worsen and threaten the nation's growth. Consumer prices rose 2.9% YoY, after a 3% YoY advance reported earlier for April, the National Statistics Office said. (Source: Bloomberg)
Vietnam: Growth may be as low as 5.2% in 2012, official says. The economy has been buffeted this year by a credit crunch after the central bank pushed up interest rates last year to fight the fastest inflation in Asia, and with some Vietnamese banks' ability to lend constrained by a lack of capital amid concern about the health of the financial system. (Source: Bloomberg)
Australia: RBA lowers key rate as Europe, China growth risks mount. Governor Glenn Stevens and his board lowered the overnight cash rate target by a quarter percentage point to 3.5%. (Source: Bloomberg)
E.U: Manufacturing, services shrink as crisis worsens in May. A composite index based on a survey of purchasing managers in both industries dropped to 46 from 46.7 in April, London-based Markit Economics said. While above an initial estimate of 45.9, the May reading is the lowest since June 2009. The indicator has remained below 50 - indicating contraction - for four months. (Source: Bloomberg)
Moody's Investor Service downgraded the credit ratings of six German banks, including the country's number two Commerzbank in view of "the increased risk of further shocks emanating from the euro area debt crisis, in combination with the banks' limited loss-absorption capacity." (AFP)
EU: German, Spanish factory output drops more than forecast
German industrial output fell more than economists forecast in April and Spanish production had the biggest drop in more than two years, adding to signs of a deepening economic slump across the euro area. German production declined 2.2% from March. Economists had forecasted a drop of 1%, according to the median of 37 estimates in a Bloomberg News survey. In Spain, output fell 8.3% from a year earlier, when adjusted for work days, a separate report showed. (Bloomberg)
EU: Edges towards banking union, too late for Spain
The European Commission proposed far-reaching powers for regulators to take control of failing banks on Wednesday, a step towards the banking union wanted by the ECB, which will come too late to help Spain. The plans, which spell out an insolvency regime for banks and empower regulators to intervene to prevent a collapse from triggering panic, first need to be approved by EU countries and the European Parliament and may not take effect until 2015. This would be far too late for Spain, which could be forced to seek a bailout for its banks if it cannot support lenders saddled with bad property loans and other debt. (Reuters)
EU: ECB holds fire; Draghi ups pressure on politicians
ECB President Mario Draghi made no major changes to monetary policy and putting added pressure on European leaders to address the euro-zone’s escalating debt crisis. “Some of the problems in the euro area have nothing to do with monetary policy. It’s not appropriate for ECB policy to take the place of other players’ lack of actions,” Draghi said. The ECB left its key lending rate unchanged at 1%. (MarketWatch)
Spain: EU, Germany exploring rescue but no request yet
Germany and EU officials are urgently exploring ways to rescue Spain's debt-stricken banks although Madrid has not yet requested assistance and is resisting being placed under international supervision, European sources said. Spain was effectively losing access to credit markets due to prohibitive borrowing costs and appealed to European partners to help revive its banks. (Reuters)
Global: Obama calls Merkel, Monti ahead of G-20 summit
President Barack Obama on Wednesday spoke with German Chancellor Angela Merkel and Italian Prime Minister Mario Monti, and agreed that steps are needed to bolster growth in Europe. "The leaders agreed on the importance of steps to strengthen the resilience of the euro zone and growth in Europe and globally, and agreed to remain in contact as they prepare for the 18-19 June G-20 Summit in Los Cabos, Mexico," a White House statement said. (MarketWatch)
U.S: Service industries sustained growth in May. The Institute for Supply Management's index of non- manufacturing businesses, which covers about 90% of the economy, unexpectedly rose to 53.7 last month from April's 53.5. Readings above 50 signal expansion. (Source: Bloomberg)
US: Productivity falls 0.9% in first quarter
The productivity of US workers and businesses fell more sharply in the first three months of 2012 than originally reported, based on an updated reading. The Labor Department initially estimated that productivity fell 0.5% the first quarter, but newly revised numbers put the decline at 0.9%. (Bloomberg)
US: Fed survey finds growth, hiring mostly steady
The US economy grew moderately in most regions of the country this spring and companies kept hiring, according to a Federal Reserve survey released Wednesday. The mostly upbeat survey offered a hopeful sign after last week's more dismal data on hiring and manufacturing. The Fed survey shows growth in each of its 12 bank districts from 3 April through 25 May. Hiring
US Stocks – Wall St climbs 2% on talk of Spain solution
US stocks jumped on Wednesday, giving S&P 500 its best day since December, as talk of a rescue of Spain’s troubled banks and hopes for more monetary stimulus sparked a rebound from recent selling. After a 6% fall by the S&P 500 in May that took the index below its key 200-day moving average on Friday, the market was ripe for a rebound, analysts said. Buying was strong across the broad market, with all 10 S&P 500 sectors gaining ground. The Dow Jones Industrial Average (DJIA) was up 286.84 pts, or 2.37%, at 12,414.79. The S&P 500 Index was up 29.63 pts, or 2.30%, at 1,315.13. (Financial Daily)
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