Thailand

• Sommai firm on land, construction tax – Finance Minister Sommai Phasee vowed yesterday that the draft land and construction tax bill would be finalised in two weeks and forwarded to the Cabinet. (The Nation, 6/3/15)
• Slide in consumer confidence prompts calls for rate cut – Consumer confidence continued to crumble last month, prompting a call for the Monetary Policy Committee to cut the policy rate by 25 basis points to cut borrowing costs. The centre’s consumer confidence index fell to 79.1 in February after falling to 80.4 in January. Other consumer confidence indices also slid: for the future to 86.4 from 87.9, for the overall economy to 68.4 from 69.7 and for finding job opportunities to 73.0 from 74.1. “Purchasing power is expected to decline and the government may need to solve this problem through an injection in the economy,” Thanawat Polvichai, director of the University of the Thai Chamber of Commerce’s Centre for Economic and Business Forecasting, said yesterday. (The Nation, 6/3/15)

• 3 million workers expected to join NSF – The government expects 3 million informal workers will sign up for the National Savings Fund (NSF) over the next five years once it starts operation in June. The long-awaited NSF, which is aimed at creating a system designed to extend welfare benefits to and ensure the financial security of informal workers, won cabinet approval yesterday. (Bangkok Post, 4/3/15)
• JSCCIB worried about slow economic recovery – The Joint Standing Committee on Commerce, Industry and Banking (JSCCIB) expected the budget disbursement will not reach 30% in 1Q2015 and lowered the forecasted export growth for the year to 2-2.5% from 3.5%. (Thai Post, 4/3/15)
• 2015 inflation forecast cut to 0.6-1.3% – The Commerce Ministry has cut its inflation target for this year to 0.6-1.3 percent, much lower than the previous projection of 1.8-2.5 percent, after the drop in oil prices and sluggish economic growth. The ministry reported that the Consumer Price Index for February fell 0.52 percent year on year, declining for the second consecutive month. Month-on-month inflation was only 0.12 percent. The CPI for the January-February period was down 0.47 percent from the first two months of 2014. Despite much lower inflation, Thailand is not yet in a deflationary situation. Many other countries are also experiencing low inflation rates due to slow economic growth. (The Nation, 3/3/15)
• Thai shippers foresee flat export growth for first half – With a sluggish global economy, fluctuating exchange rates and the limited competitiveness of Thai export products, the Thai National Shippers Council foresees flat export growth in the first half of the year, and full-year growth of only 1.1-1.5 per cent. (The Nation, 3/3/15)
• FPO weakens provisions for land and buildings tax – Amid the growing outcry over the planned land and buildings tax, the Fiscal Policy Office (FPO) is rushing to soothe worries by providing a two-year grace period after the law takes effect and another two years of discounted tax rates before charging the full rates. (Bangkok Post, 3/3/15)
• New body to govern state firms – The State Enterprises Policy Commission or superboard yesterday approved in principle the establishment of a holding firm to supervise state-owned companies in a move to prevent political interference and ensure management transparency. (Bangkok Post, 3/3/15)
• Consumption fall ‘surprising’ – With tumbling oil prices expected to bolster private consumption, last month’s contraction in consumption came as a surprise, says a senior Bank of Thailand official. The high level of household debt and falling farm prices were to blame, said Roong Mallikamas, senior director for macroeconomic and monetary policy. The private consumption index declined by 1.5% year-on-year last month, worse than December’s contraction of 0.8%. Falling prices of agricultural produce, particularly rubber, dented household spending, while consumer spending was weighed down by elevated household debt, Mrs Roong said. (Bangkok Post, 28/2/15)
• Supervisory body mulled – The State Enterprises Policy Commission or superboard is mulling five options for a planned supervisory body to govern state enterprises, says a Finance Ministry source. The options are empowering the State Enterprise Policy Office (Sepo) to supervise state enterprises and retaining it under the Finance Ministry, authorising Sepo to supervise state enterprises but transferring it to the Prime Minister’s Office, setting up a new ministry, establishing an independent body such as the Bank of Thailand or the Securities and Exchange Commission and incorporating a holding company. The five options have been initiated by a subcommittee tasked with studying formats for supervisory units. (Bangkok Post, 28/2/15)
• Thailand’s manufacturing production index slipped 1.3% in January as Samsung and LG moved their TV production to other countries, said the OIE. (Bangkok Biz, 28/2/15)

Globally

• U.S. initial jobless claims jump to 10-month high – The number of Americans initially applying for unemployment aid in the final week of February jumped to the highest level since May, U.S. Labor Department said Thursday. In the week ending Feb. 28, the advance figure of seasonally adjusted initial claims for jobless benefits rose by 7,000 to a 10- month high of 320,000, higher than economists’ expectation of 295, 000, the department said. (Xinhua, 6/3/15)
• U.S. factory orders continues to fall in January – U.S. factory orders had kept falling for six consecutive months by January, the U.S. Commerce Department said in a report Thursday. In January, new orders for manufactured goods lost 0.9 billion U.S. dollars, or 0.2 percent, to 470 billion dollars, the report said. This followed a 3.5 percent decrease in December. (Xinhua, 6/3/15)
• ECB QE policy to start on March 9 – The European Central Bank (ECB) said on Thursday that its quantitative easing program (QE) will start on March 9. The announcement was made by ECB President Mario Draghi after a meeting of its Governing Council in the Cypriot capital of Nicosia. Draghi said ECB will purchase Eurogroup member countries bonds until at least September, 2016 worth an estimated 1.1 trillion euros. (Xinhua, 5/3/15)
• ECB’s Draghi says emergency lending to Greek banks has been increased – European Central Bank President Mario Draghi said on Thursday the amount of emergency lending available to Greek banks had been increased.”We have raised the ELA (Emergency Lending Assistance) today,” he told a news conference in Cyprus following an ECB policy meeting.Draghi said Greek banks were solvent and had capital levels well above minimum requirements. (Reuters, 5/3/15)
• ECB raises eurozone growth forecast to 1.5% for 2015 – The European Central Bank has raised this year’s eurozone growth forecast to 1.5%, up from 1% previously. It also said it would start its quantitative easing programme, first announced in January, next week. Bank boss Mario Draghi said economic growth in the eurozone would strengthen slowly to reach 2.1% by 2017. He also said there would be low negative inflation in the months ahead before prices began to rise in late 2015, with 1.8% inflation in 2017. Earlier, the bank kept the eurozone’s key interest rate unchanged at 0.05%, as expected. (BBC, 5/3/15)
• British central bank enters into seventh year of ultra-low interest rate – The Bank of England (BoE) Thursday voted to keep its main interest rate Bank Rate unchanged at 0.5 percent, and kept the quantitative easing (QE) policy at 375 billion pounds (or 572 billion U.S. dollars). This marks the entry into the seventh year of the British central bank holding the benchmark rate at an ultra-low level. The decision is within the market’s estimation consensus. (Xinhua, 5/3/15)
• Service-Sector Activity Edges Up in February – The expansion in the U.S. non-manufacturing sector continued at a pace slightly better than expected last month, according to data released Wednesday by the Institute for Supply Management. The ISM’s non-manufacturing purchasing managers index came in at 56.9 in February, a bit better than the 56.7 in January and 56.5 in December. Forecasters surveyed by The Wall Street Journal had expected last month’s PMI to fall to 56.2. (WSJ, 4/3/15)
• U.S. private sector adds 212,000 jobs in February – The U.S. private sector added 212,000 jobs in February, lower than market expectation, said a private survey released Wednesday. The figure was down from 250,000 jobs in January, said the National Employment Report released jointly by Automatic Data Processing (ADP) and Moody’s Analytics, based on a monthly survey. Economists’ average expectation was about an increase of 220, 000 jobs in February. (Xinhua, 5/3/15)
• Chinese service PMI continues to grow in February: HSBC – The service sector continued to expand in February, but at a modest pace, according to an industry index released by HSBC on Wednesday. The HSBC/Markit China Services Business Activity Index, which provides a snapshot of operating conditions in the sector, stood at 52 in February, up from 51.8 in January. (Xinhua, 4/3/15)
• China lowers 2015 economic growth target to around 7 percent – China targeted economic growth of approximately 7 percent in 2015, lower than the goal of around 7.5 percent in 2014, according to a government work report to be delivered by Premier Li Keqiang at the parliament’s annual session Thursday. The growth target for 2015 is also lower than the 7.4-percent economic growth rate registered in 2014, its weakest annual expansion since 1990. (Xinhua, 5/3/15)
• India cuts key lending rates to boost economy – In a surprise move, the Reserve Bank of India (RBI) Wednesday cut the key policy rate by 25 basis points, triggering optimism of stimulating selling and buying of expensive commodities like cars and homes. The policy repo rate under the liquidity adjustment facility is cut by 25 basis points to 7.5 percent from 7.75 percent. The reduction will come into effect immediately. This would set tones for all commercial banks in their lending policies. The RBI has, however, kept the cash reserve ratio of scheduled banks unchanged at 4 percent of net demand and time liabilities while reducing to 6.5 percent the reverse repo rate from 6.75 percent. (Xinhua, 4/5/15)
• Weak U.S. consumer spending points to slower first-quarter growth – Consumer spending, which accounts for more than two-thirds of U.S. economic activity, slipped 0.2 percent after falling 0.3 percent in December. The January dip reflected lower gasoline prices, which weighed on sales receipts at service stations, as well as drop in purchases of big-ticket items. With lower gasoline prices dampening inflation pressures, the so-called real consumer spending increased 0.3 percent after slipping 0.1 percent in December. But economists said the rise in the measure, which goes into the calculation of gross domestic product, was disappointing. (Reuters, 2/3/15)
• U.S. manufacturing activities moderate in February – The manufacturing index, also known as the purchasing managers index (PMI), registered 52.9 percent, a decrease of 0.6 percentage point from a month ago, the Institute for Supply Management (ISM) said in a report. It indicated expansion in manufacturing for the 26th consecutive month, and the overall economy grew for the 69th consecutive month. (Xinhua, 3/3/15)
• U.S. manufacturing sector gathered momentum in February – According to financial data firm Markit Monday. The final seasonally adjusted Markit U.S. Manufacturing Purchasing Managers Index (PMI) rose to 55.1 in February from 53.9 in the previous month, its highest level since October 2014. (Xinhua, 3/3/15)
• Eurozone factory growth steady in February – The latest Markit Eurozone Manufacturing Purchasing Managers’ Index (PMI) still pointed to only a modest pace of growth across factories in the eurozone but some economists were sounding a bit more optimistic about the future. The latest PMI held steady at 51.0 in February, slightly below an earlier flash reading of 51.1 and just above the 50 threshold that separates growth from contraction. (Reuters, 2/3/15)
• Euro area annual inflation rises to minus 0.3 pct – Annual inflation of the eurozone is expected to be minus 0.3 percent in February of 2015, up from minus 0.6 percent in January, according to a flash estimate released Monday by Eurostat, the statistical office of the European Union. (Xinhua, 2/3/15)
• Euro area unemployment rate in Jan. at 11.2 pct – The eurozone seasonally-adjusted unemployment rate was 11.2 percent in January 2015, down slightly from 11.3 percent the previous month, the lowest rate since April 2012, Eurostat, the statistical office of the European Union (EU) said on Monday. In the wider EU, the unemployment rate was 9.8 percent in January 2015, down from 9.9 percent in December 2014. (Xinhua, 2/3/15)
• Japan’s tax revenues highest for Jan. in 21 years – Japan’s tax revenues in January surged 18.3 percent from a year earlier to 4,861.28 billion yen (US$40.53 billion), hitting the highest level for the month in 21 years, the Finance Ministry said Monday. (Kyodo News, 2/3/15)
• U.S. economy slows in Q4 despite robust consumer spending – U.S. economy in the fourth quarter of 2014 expanded at a slower pace than estimated despite robust growth of personal consumption spending. According to the second estimate from the U.S. Commerce Department on Friday, the economy expanded at a 2.2 percent annual rate in the fourth quarter of 2014, revised down from the advance estimate of 2.6 percent. (Xinhua, 28/2/15)
• U.S. pending home sales gain in January – The Pending Home Sales Index, a forward-looking indicator based on contract signings, climbed 1.7 percent to 104.2 in January from an upwardly revised 102.5 in December, reported the National Association of Realtors Friday. (Xinhua, 28/2/15)
• The Thomson Reuters/University of Michigan’s February final reading of consumer sentiment index decreased from January’s final reading of 98.1 to 95.4, but still beat market expectations. (Xinhua, 28/2/15)
• The Chicago Business Barometer plunged 13.6 points to 45.8 in February, the lowest level since July 2009 and the first contraction since April 2013, said the Institute for Supply Management-Chicago. (Xinhua, 27/2/15)
• Fed’s Lockhart: FOMC meetings from June onward open to rate increases – Federal Reserve Bank of Atlanta President Dennis Lockhart continues to cautiously eye favoring an interest rate increase this summer, although he added he still needs to see more data to support such an action. When it comes to lifting the Fed’s short-term interest rate target off the near-zero levels its occupied since the end of 2008, “I continue to believe that all meetings from June onward should be on the table,” the official said in an interview with The Wall Street Journal. (WSJ, 27/2/15)
• German parliament approves Greek bailout extension – German lawmakers approved the extension of Greek bailout program on Friday. In a vote at Bundestag, the lower house of German parliament, 542 of the 587 lawmakers who participated in the ballot voted yes to the extension, with 32 against and 13 abstentions. The approval on Friday, which was necessary for the extension until the end of June to come into force, was no surprise as German Chancellor Angela Merkel’s ruling coalition holds 80 percent of the parliament seats. (Xinhua, 27/2/15)
• China cuts interest rates again – China’s central bank announced on Saturday that it will slash benchmark deposit and loan interest rates by 25 basis points from March 1, a second such cut in three months, underscoring continuing downward pressure on the world’s second-largest economy. The cut will bring the one-year deposit rate to 2.5 percent, and the lending rate to 5.35 percent, according to a statement on the website of the People’s Bank of China (PBOC). (Xinhua, 28/2/15)
• China’s manufacturing PMI rebounds in February – The manufacturing purchasing managers’ index (PMI), a key measure of factory activity in China, posted 49.9 in February, up from 49.8 the previous month, according to the National Bureau of Statistics (NBS) and the China Federation of Logistics and Purchasing (CFLP). (Xinhua, 2/3/15)
• China’s Feb. non-manufacturing PMI up – The purchasing managers’ index (PMI) for the non-manufacturing sector recovered to 53.9 in February from 53.7 in January, according to a report released jointly by the National Bureau of Statistics (NBS) and the China Federation of Logistics and Purchasing (CFLP). (Xinhua, 2/3/15)