Malaysia

Malaysia Foreign Currency Rating Affirmed. Malaysia’s long and short-term foreign currency sovereign credit ratings have been affirmed at A- andA-2, respectively, by Standard & Poor’s Ratings Services. The rating agency based the credit rating on the country’s strong external balance sheet, open and competitive middle-income economy, and considerable monetary flexibility despite the sticky fiscal deficits and an increasing government debt burden. It also affirmed the country’s A long-term and A-1 short-term local currency sovereign credit ratings. “The outlook on the long-term rating remains stable. Standard & Poor’s also affirmed its Asean regional scale rating on Malaysia at axAAA/axA-1+,” it said in a statement. (The Star)

Asia 

Japan Consumer Prices Rise For First Time In 14 Months. Japanese consumer prices rose for the first time in more than a year in June, a sign that policies aimed at ending deflation could be yielding results. Data showed that consumer prices, excluding food, rose by 0.4% - the biggest increase for five years. However, the rise was mainly due to higher energy bills rather than increased domestic demand. Prime Minister Shinzo Abe has said that he will end more than a decade of falling prices. (BBC)

China’s Industrial Profits Growth Moderates As Economy Cools. Growth in Chinese industrial companies’ profits slowed in June as the economy cooled, costs rose and prices fell on moderating demand and overcapacity. Net income increased 6.3 % from a year earlier to 502.4 billion yuan ($82 billion), the Beijing-based National Bureau of Statistics said yesterday, down from a 15.5 % pace in May. Profit from main business operations fell 2.3 % after an 8.8 % gain the previous month, it said. (Bloomberg)

China To Audit Government Borrowings As Risks To Growth Increase. China will begin a nationwide audit of government borrowings, as the nation’s growth slowdown puts pressure on the new leadership to determine the extent of potential bad debts weighing down the economy. The State Council, under Premier Li Keqiang, requested the National Audit Office to conduct a review, according to a statement from the audit office’s website yesterday, without providing any more details. The first audit of local government debt found liabilities of 10.7 trillion yuan ($1.8 trillion) at the end of 2010, the National Audit Office said in June 2011. (Bloomberg)

USA

Consumer Sentiment In U.S. Increases To Six-Year High July. Consumer confidence unexpectedly increased in July to the highest level in six years as Americans’ views of their finances improved. The Thomson Reuters/University of Michigan final index of consumer sentiment advanced to 85.1 in July from 84.1 at the end of June. Economists in a Bloomberg survey called for 84, according to the median projection after a preliminary reading of 83.9. (Bloomberg)

US Economy Improving Slowly, IMF Says. The underlying condition of the US economy is improving, according to the International Monetary Fund (IMF). However, the IMF added that the recovery from recession has so far been "tepid". In its regular assessment of the economy, the IMF said the US still faces "powerful headwinds". But it noted gains on stock markets and in house prices, and predicted that economic growth should gradually accelerate over the next year. The IMF said the expiration of the payroll tax cut earlier this year and the impact of government spending cuts (through the so-called sequester) were "weighing significantly on growth this year". However, further ahead, the IMF sees a slightly brighter picture and expects "economic activity to accelerate to 2.7% next year as the fiscal drag subsides and the negative legacies of the financial crisis wane further". (BBC)

Europe

Italy Banks Cut Credit, Small Businesses Gasping. Loans to businesses in recession-hit Italy dropped by 4.2 % over the past year, with small companies in particular suffering from difficulties in obtaining credit and unpaid state bills,  a new report warned Saturday. Between May 2012 and May 2013, total bank loans dropped by 41.5 billion euros (US$55 billion), or 4.2 %, small business association Confartigianato said. The situation is aggravated by the amount the state owes the private sector, which the report said amounted to 91 billion euros in 2012. (AFP)

Germany To Take On Less New Debt This Year. Germany will take on slightly less new debt this  year than planned, Finance Minister Wolfgang Schaeuble said in an interview. Tax revenue rose by a higher-than-expected 3.5% on the year in the first half of 2013, as the income tax take increased thanks to a robust labour market and rising wages. Chancellor Angela Merkel’s government aims to use higher revenue to achieve a balanced budget in 2014 for the first time in decades. (Reuters)

Currencies

Dollar Posts Weekly Decline Of More Than 1%. The U.S. dollar slid more than 1% for the week as investors contemplated the Federal Reserve’s upcoming monetary-policy statement and its timeline for unwinding stimulus. The ICE  dollar index, a gauge of the greenback’s movement against six other major currencies, fell 1.14% this week. The index fetched 81.665 in recent trade, lower than 81.677 Thursday. The euro on Friday traded at $1.3274, down from $1.3290 on Thursday, when it reached its strongest level since June 19, according to data from FactSet. The British pound fell to $1.5381 from $1.5425 Thursday. The pound, which last traded above the $1.54 level on June 25, also found support Thursday after the U.K.’s second-quarter gross domestic product expanded. Elsewhere Friday, the U.S. dollar couldn’t hold gains against the  Japanese yen  following figures showing Japan registered mild inflation in June. Meanwhile, the Australian dollar traded at 92.62 U.S. cents, down from 92.78 U.S. cents on Thursday. (Market Watch)

Commodities

Brent Holds Above $107 On Weak Dollar, Supply Cuts. Brent crude held steady above $107 a barrel on Friday as a weak dollar and supply disruptions at some Middle Eastern and African oil producers offset worries about China's economic slowdown and decadeshigh oil output in the United States. Brent crude for September delivery edged up 12 cents to trade at $107.77 a barrel by 0242 GMT, after posting a 46-cent gain on Thursday. U.S. crude for September was at $105.55 a barrel, up 6 cents. (Reuters)

Gold Posts 3 % Weekly Gain, Fed Comment Eyed. Gold was flat on Friday after a late rally erased initial losses and bullion ended the week nearly 3 % higher as wariness over the U.S. Federal Reserve's message at next week's monetary policy meeting pushed the dollar down. Spot gold fell 0.2 % to $1,330.30 per ounce by 3:46 p.m. EDT (1946 GMT). Among other precious metals, silver fell 1.2 % to $19.95 per ounce, platinum was down 1.5 % at $1,424.49 while palladium slipped 2 % to $721.97. (Reuters)