What happened this week 07/10 – 11/10

Thailand
  • King endorses budget bill – The 2014 budget bill received His Majesty the King’s endorsement on Friday and was published in the Royal Gazette, enabling the government to immediately disburse funds for the fiscal year that began on Oct 1. The House of Representatives passed the Bt2.5trn budget in late August and the bill sailed through the Senate. (Bangkok Post, 11/10/13) 
  • MPC to hold rate steady: survey — Economists expects the BoT to hold key interest rates at 2.5% in the BoT meeting on Oct 16, as the economy is showing signs it may be bottoming out and the BoT may start increasing interest rates in the middle of next year. (Krungthep Turakij, 13/10/13)
  • PM: Relations with China strong — The Prime Minister of Thailand says Thai-China relations are stronger than ever, resulted in a change in the MoU with China for rice from the purchase of 1mn tons over five years to 1mn tons in one year. (IQ Biz, 14/10/13)
  • Student loan reform ahead — The MoF is considering student loan reform, due to concerns the Bt6.7mn budget slash will hurt students nationwide. Management of the student loan fund will aim to plug the student loan budget ‘gap’ by tapping the central government budget. (Thai Post, 14/10/13)
  • Condo market slowdown expected — Thailand Real Estate Information Center revealed that it expects a slowdown in the condo market next year. Cost of construction is expected to increase by 5% as the government’s huge infrastructure plan will take most of the workforce, pushing up the cost of labor. (Kom Chad Luek, 16/10/13)
  • BoT: Thai banks have highest NPL provisions — The BoT says that Thai banks have the highest average reserve NPL ratio in the region, exceeding 140%. Average NPL level is constant at 2.2% while loan growth remain strong (Bangkok Post, 16/10/13)
  • 5mn Chinese visitors expected on waived visa as govts agree to discussion — A proposed visa exemption for regular passport holders will offer Chinese and Thai tourists more convenience, and promote closer bilateral people-to-people exchanges, Chinese Premier Li Keqiang said here on Saturday. Chattering with Chinese tourists in the Thai capital, Li, currently on an official visit to the country, asked about their tourism experiences in Thailand and talked about the visa exemption initiative. China is now the biggest source of tourists to Thailand, with about 3.22mn Chinese visiting in the first eight months of 2013, up 88.42% over the same period of 2012, according to the Tourism Authority of Thailand. Vichit Prakobgosol, honorary director for the Thai-Chinese Tourism Alliance Association and chairman of CCT Group, a travel service consultancy, believes that about 5mn Chinese will visit Thailand next year if such a policy can take effect. (The Nation Website and Xinhua News Agency)
  • MPC keeps rate unchanged, as expected — The Bank of Thailand’s Monetary Policy Committee (MPC) yesterday kept the policy rate unchanged at 2.5%, and economists expect the panel to stand pat at the year’s final meeting in November. (Bangkok Post, 17/10/13)
Globally
  • US: The preliminary reading of the U.S. consumer confidence index in October fell to 75.2, the lowest level in nine months, as the government shutdown dampened Americans’ outlook on the economy, according to the monthly Thomson Reuters/University of Michigan survey of consumers. (Xinhua, 12/10/13)  
  • US: Manufacturing activity in the New York region declined in October. The general business conditions index fell 5 points to 1.5, the slowest pace of improvement since May, according to the Federal Reserve Bank of New York’s monthly Empire State Manufacturing Survey. (Xinhua, 16/10/13)
  • Japan: Japan halfway to beat persistent deflation: Abe- Japanese Prime Minister Shinzo Abe said Tuesday that the country’s economic recovery has yet to be truly felt, pledging to make more efforts to fight deflation. He reiterated that the government would raise the sales tax to 8% from the current 5% as planned next April, while large-scale economic stimulus policies would be implemented to cope with any negative impact on household and business spending. According to Abe, the government will also press for bills to establish special economic zones to boost business investment through deregulation, which is partly aimed at supporting Tokyo’s hosting of the 2020 Summer Olympics in the areas of infrastructure development and other projects. (Xinhua, 15/10/13)  
  • China: The Chinese state council announced guidelines to reduce production to help five business sectors which were affected by the excess production in the country; amongst these were steel, cement, aluminum, electrolytes, glass and general cargo through shipping. (IQ Biz, 15/10/13)
  • London to develop further as yuan trading hub – China and the United Kingdom on Tuesday agreed to continue to build London into a major offshore market for yuan trading, underlining the strong financial ties between the two countries. Both sides welcomed strong growth of London’s RMB markets, making the capital city the most active RMB center in the world outside China, according to a joint statement after the fifth China-UK Economic and Financial Dialogue held in Beijing. (Xinhua, 15/10/13)
  •  China:China consumed 444.8 billion kilowatt hours (kWh) of power in September, up 10.4 percent year on year, figures from the National Energy Administration showed on Monday. (Reuters, 14/10/13)
  • China’s money-supply growth slowed in September and new local-currency loans were more than forecast, data from the People’s Bank of China today showed.  (Bloomberg, 12/10/13)
  • Eurozone: Industrial production in the eurozone rose by one per cent in August, official Eurostat data showed on Monday, in a tentative sign the currency bloc’s struggling economy is beginning to revive. (Business Times, 13/10/13)
  • US: U.S. initial jobless claims retreat, but way above pre-shutdown level – The number of Americans initially applying for unemployment aid dipped last week, but still stood well above the pre-shutdown level, the U.S. Labor Department reported Thursday. In the week ending Oct. 12, the advance figure of seasonally adjusted initial claims for jobless benefits edged down by 15,000 to 358,000 from the previous week’s revised figure of 373,000, the highest since late March. (Xinhua, 17/10/13)
  • US business activity expanded in October at a slower pace in the mid-Atlantic region, with the reading decreasing to 19.8 from 22.3 in the prior month, the Federal Reserve Bank of Philadelphia reported Thursday. (Xinhua, 18/10/13)  
  • China’s Dagong Global Credit Rating Co. cut its sovereign rating for the U.S. hours after President Barack Obama signed legislation raising the federal debt limit. Downgrading the local and foreign currency credit ratings of the U.S. to A- from A, maintaining a negative outlook, the company said in an e-mailed statement yesterday. That’s below Dagong’s rating of Botswana, which has an A rating, and puts the U.S. on par with Brazil. (Bloomberg,17/10/13)
  • Asian Development Bank chief Takehiko Nakao brushed off concerns Thursday over the possible negative impact on emerging Asian economies from the U.S. central bank’s move to wind down its quantitative easing policy, saying they are well prepared for risks and that adjustments in their markets will soon be over. (Global Post, 17/10/13)
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  • US: U.S. builder confidence in the market for newly built, single-family homes fell two points in October from the prior month, according to the Housing Market Index released jointly by the National Association of Home Builders and Wells Fargo. Moreover, the U.S. economic activity continued to expand at a modest to moderate pace during the reporting period of September through early October, the Federal Reserve said Wednesday in its ” Beige Book.” (Xinhua, 17/10/13)
  • Europe: Portugal looks set to fail to meet the 2013 deficit target of 5.5% of GDP agreed with the troika, with the figure expected to stay at around 5.9%, meaning austerity will continue into next year. The budget will cut €3.9bn in state expenditure. (Presseurop, 16/10/13)
  • The consumer price index (CPI) in the eurozone decreased to a 3-year low of 1.1% in September, down from 1.3% in August, European Union (EU) statistics office Eurostat said Wednesday. (Xinhua, 16/10/13)
  • Great Britain: Jobless rate remains at 7.7% and the squeeze on households is intensifying, but a sharp drop in those claiming jobseekers’ allowance boosts recovery hopes. (Telegraph, 16/10/13)
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