Malaysia

World Bank: Malaysia Poised To Achieve High Income  Status. Malaysia is well poise to achieving high-income country by 2020, looking by the county’s economic performance thus far, said the World Bank chief economist Kaushik Basu. “Malaysia’s target to become high income country by 2020 is possible, and the country is capable to be more ambitious by aiming for per capita income of US$20,000 by 2025,” he told Stabiz at the side-lines after the bank launched its “June 2013 Malaysia Economic Monitor: Harnessing Natural Resources” report recently. The Bank is targeting the Malaysia's economy to grow 5.1% this year. (The Star)

Malaysia Wants To Diversify Exports To Japan. Malaysia wants to diversify its exports to Japan as currently, about half are made up of liquefied natural gas (LNG) and the rest are wood and wood-based products and electrical and electronic products. International Trade and Industry Minister Datuk Seri Mustapa Mohamed said the government wants to reduce its dependency on LNG exports. "Malaysia has a lot to offer to Japan other than LNG. Under the 12 National Key Economic Areas, we can export more in services, palm oil, tourism, healthcare, financial services and agriculture," he told delegates at a seminar on  investment and business opportunities in Malaysia here on Monday. Mustapa is leading a 25-member trade mission to Japan and South Korea which ends today. (Business Times)

Malaysia's Household Debt Not At Worrying Level. The country’s household debt exposure is not at a worrying level and the nonperforming loan (NPL) ratio is still under control, said Second Finance Minister Datuk SeriAhmad Husni Hanadzlah. “If we can control personal debt, in terms of loan applications and the ability of the borrower to repay, that is what we should focus on. ”What is important is the loan performance in the financial sector portfolio is of high quality,” he told reporters after launching his ministry’s open day celebrations here yesterday. The Government was looking at ways to improve the household debt situation, he said. (The Star)

Asia 

China's June Services Sector Growth At Nine-Month Low. Growth in China's services sector sagged to its weakest pace in nine months in June as construction activity slowed, a survey showed on Wednesday, a sign that an economic  cool-down is creeping across the country. The National Bureau of Statistics (NBS) said China's official purchasing managers' index (PMI) for its services sector dropped to 53.9 in June from May's 54.3. A PMI reading above 50 suggests firms are growing, while that below 50 indicates contraction. (Reuters)

USA

Companies In U.S. Added More Workers Than Forecast  In June. Companies in the U.S. added more workers than economists projected in June as businesses prepared for a pickup in consumer demand in the second half of the year. The 188,000 increase in employment followed a revised 134,000 gain in May that was 1,000 less than initially estimated, the ADP Research Institute reported today. Based in Roseland, New Jersey, the institute is a division of Automatic Data Processing Inc., a company that manages employer payrolls. The median forecast of 38 economists surveyed by Bloomberg called for an advance of 160,000 in June. (Bloomberg)

Jobless Claims In U.S. Fall By 5,000 In Week To June 29. Fewer Americans filed claims for unemployment benefits last week, showing employers are holding off on firings as growth prospects improve. Jobless claims decreased by 5,000 to 343,000 in the week ended June 29 from a revised 348,000 in the prior period that was higher than initially reported, the Labor Department said today in Washington. The Bloomberg survey median called for 345,000 claims. No states were estimated and there was nothing unusual in the data, a Labor Department spokesman said shortly before the figures were released. The data were made public one day early due to the Independence Day holiday tomorrow. (Bloomberg)

Trade Deficit In U.S. Jumped In May As Imports Near Record. The trade deficit in the U.S. unexpectedly jumped in May as imports climbed to the second-highest level on record, pointing to an economy that is overcoming higher taxes and government cutbacks. The gap widened by 12.1 % to $45 billion, the biggest since November, from $40.1 billion in April, Commerce Department figures showed today in Washington. The median forecast in a Bloomberg survey of 71 economists called for a $40.1 billion deficit. The value of imports at $232.1 billion was second only to a record $234.3 billion in March 2012. (Bloomberg)

US Car Sales Hit Best Pace Since Dec 2007. Car sales in the United States accelerated in June to the best performance since December 2007 as analysts forecast more growth in the months to come. Total industry sales came in at an annualised pace of 16 million vehicles in June, up from 15.3 million in May and 14.4 million in June 2012, Autodata reported on Tuesday.  Total industry sales were up 9.2 per cent from June 2012, while sales in the first half of the year were up 7.7 per cent, according to Autodata. Toyota led the pack with a 14 per cent gain to 195,235 vehicles in June.  Sales for the first half of the year were up six % at 1.1 million vehicles. (AFP)

Service Industries Unexpectedly Grew At Slower Pace In June. Service industries in the U.S. unexpectedly expanded in June at the slowest pace in more than three years, indicating widespread progress may elude the world’s largest economy even as manufacturing improves. The Institute for Supply Management’s non-manufacturing index dropped to 52.2 last month, the lowest reading since February 2010, from 53.7 in May, a report from the Tempe, Arizona-based group showed today. The median forecast in a Bloomberg survey called for a rise to 54. A reading greater than 50 indicates expansion in the industries that make up almost 90 % of the economy. (Bloomberg)

Europe

Eurozone Economy On Track To Stabilise In Second Half. The eurozone economy looks on course to stabilise in the second half of this year, even if a return to outright growth is still a while off, business surveys suggested. Markit’s final Composite Eurozone Purchasing Managers’ Index, a monthly survey of thousands of companies, rose to its highest since March 2012 last month, climbing to 48.7 from May’s 47.7, although it was revised down slightly from a preliminary reading of 48.9. The index edged closer to the 50 point line dividing growth from contraction for the third month in a row, although it still suggested  the euro zone’s recession extended through the second quarter. (Reuters)

UK Service Sector Growth 'Fastest For Two Years'. The UK's services sector, which accounts for about 75% of the economy, grew at its fastest rate for more than two years in June, a survey suggests. The Markit/CIPS Services Purchasing Managers' Index (PMI) for the UK rose to 56.9 in June, from 54.9 in May. A figure above 50 indicates growth. The survey adds to signs that the economic recovery is strengthening. Markit says it expects the UK economy to grow by at least 0.5% in the second quarter of 2013. (BBC)

Portugal Borrowing Costs Rise Amid Looming Crisis. Portugal's borrowing costs have risen sharply amid fears of a growing political crisis in the country. Yields on the country's benchmark 10-year bonds moved above 8% at one point, while the stock market closed down 5.3%. Earlier this week, the resignations of two leading ministers put pressure on Portugal's coalition government. The European Commission President, Jose Manuel Barroso, said he was following the situation "with concern". Portugal received a bailout worth more than 78bn euros ($102bn) in May 2011, on the condition it implemented austerity measures. (BBC)

Merkel Warns On Youth Unemployment Problem. Youth unemployment is "perhaps the most pressing European problem", German Chancellor Angela Merkel has said, ahead of an EU meeting on the issue. Ministers are meeting in Berlin to discuss measures to tackle unemployment among Europe's young people. EU leaders have agreed to put spend 6bn euros ($7.8bn) on the problem, but have not agreed on what measures the money will be spent. Statistics suggest 23% of people under 25 are unemployed in Europe. (BBC)

Currencies

Dollar Dips As Traders Await Payrolls, ECB. The dollar slipped back below 100 yen on Wednesday and posted a mixed performance versus other major rivals as traders geared up for a busy 48 hours that include the European Central Bank’s monthly policy meeting on Thursday and June U.S. nonfarm payrolls on Friday. The U.S. currency traded near ¥99.89 in recent action after trading as low as ¥99.22. But the euro reversed a decline versus the dollar to fetch $1.3003, up from around $1.2970 late Tuesday, rebounding after European markets closed. The euro slid around 0.7% against the Japanese currency to ¥129.90. The ICE dollar index, which measures the U.S. unit against six other major currencies, fell to 83.249 from 83.561 late Tuesday. The British pound bought $1.5275, up from $1.5206. The  Australian dollar bought 90.62 U.S. cents compared with 91.43 U.S. cents late Tuesday in North America. (Market Watch)

Commodities

U.S. Crude Rises Above $100 To Highest In 14 Mths. U.S. crude futures gained more than $1 a barrel on Wednesday, rising above $100 to hit the highest level in 14 months, after industry data showed a surprisingly large drop in crude stockpiles. U.S. crude futures hit a 14-month high of $100.64 a barrel and were at $100.47, up 87 cents by 0008 GMT. Brent crude futures rose 61 cents to $104.61 a barrel, the highest in more than a week. (Reuters)

Gold Buoyed By Weak Dollar, Safe-Haven Buying. Gold rose almost one % on Wednesday, as the dollar remained under pressure after mixed U.S. data and political turmoil in Egypt and Portugal triggered safe haven buying. Spot gold rose as much as 1.5 % to a session high of $1,259.60 an ounce earlier and was at $1,252.91 an ounce at 2:55 p.m. EDT (1855 GMT), up 0.93 %. Silver tracked gold's gains, up 2 % to $19.74 an ounce. Platinum fell 1.6 % to $1,341.75 an ounce and palladium slipped 0.17 % to $682.72 an ounce. (Reuters)