Asia

China Industrial Output Hits 17-Month High, Retail Sales Up. China's industrial production rose 10.4% in August year-on-year, the government announced Tuesday, its fastest increase for more than a year in another positive sign for the world's second-largest economy. The figure showed the most rapid increase in industrial production, a key indicator which measures output at factories, workshops and mines, since March 2012. The finding was ahead of market expectations, with the median forecast in a poll of 11 economists by Dow Jones Newswires predicting a rise of 9.9%. Output also rose 9.5% over the first eight months of this year, the National Bureau of Statistics (NBS) said. Retail sales, a key indicator of consumer spending, rose 13.4% in August compared with the same month last year, it said, just ahead of expectations of 13.2% in the same poll. They increased 12.8% in the first eight months of the year, the NBS added. (AFP)

China Shadow Banking Returns As Growth Rebound Adds Risks. China’s broadest measure of new credit almost doubled in August from the previous month in a sign leaders are committed to meeting economic goals even at the cost of adding financial risks. Aggregate financing was 1.57 trillion yuan ($257 billion), the People’s Bank of China said in Beijing yesterday, topping the 950 billion yuan median estimate of 10 analysts surveyed by Bloomberg News. New yuan loans from banks accounted for about 45 % of the total, down from July’s 87 %, as non-traditional credit played a bigger role. (Bloomberg)

India's August Trade Deficit Shrinks As Exports Rise. India's trade deficit narrowed to $10.9 billion in August, helped by a double digit rise in merchandise exports, provisional government data showed on Tuesday, offering some respite for the troubled rupee currency. Merchandise exports rose 12.97 % in August to $26.14 billion from a year earlier. Imports fell 0.68 % year-on-year to $37.05 billion. "We are closing the trade gap," Trade Minister Anand Sharma told reporters at a press conference. (Reuters)

Australia Business Confidence Hits 2-Year High. Australian business confidence surged in August as firms hoped a Federal election would put an end to political uncertainty, though Tuesday's survey showed actual conditions were weak with a worrying downturn in employment. National Australia Bank's monthly survey of over 600 firms found confidence improved across all sectors following a cut in interest rates early in August and ahead of an expected victory by the conservative Liberal National Coalition in elections on Sept. 7. The survey's main measure of business confidence shot up to 6, from -3 in July, the highest reading since May 2011 and the sixth largest monthly increase in the series' history. (Reuters)

USA

Job Openings In U.S. Fell In July To Lowest In Six Months. Job openings in the U.S. fell in July to the lowest level in six months, signaling uneven progress in employment. The number of positions waiting to be filled declined by 180,000 to 3.69 million, from a revised 3.87 million the prior month that was weaker than initially reported, the Labor Department said today in Washington. Hiring rose and firings cooled. (Bloomberg)

Europe

U.K. House-Price Index Rises To Highest Since 2006. A U.K. house-price gauge rose to the highest in almost seven years in August as the economic recovery gathered pace and government measures boosted demand, the Royal Institution of Chartered Surveyors said. The index increased to 40 from a revised 37 in July, the highest since November 2006, London-based RICS said in a report today, citing a poll of property surveyors. A proxy measure of demand rose to a record, while the outlook for prices advanced to the highest since 2002. (Bloomberg)

IMF Boss Calls For Speedy Eu Bank Union. The head of the International Monetary Fund has called for a proposed European banking union to be completed quickly. Speaking at a conference in Paris, Christine Lagarde described the euro area as a "beautiful ship" but said it was not ready to sail in rough waters. The banking union project is designed to prevent a repeat of the global banking crisis. It could include a single banking supervisor, and pool national resources to rescue banks. (BBC)

EU Financial Transaction Tax Illegal, Say Lawyers. Imposing a financial transaction tax (FTT) in 11 European Union member states would be illegal, according to the bloc's lawyers. The controversial tax aims to discourage risk-taking by taxing transactions of shares, currencies and bonds. The 14-page legal opinion concludes the move would exceed member states' tax powers. It adds that the measure is also incompatible with the EU treaty. The FTT, also known as the Robin Hood tax and Tobin tax, is set to be adopted by 11 EU states, but not by the UK. But the legal document claims the transaction tax plan "exceeds member states' jurisdiction for taxation under the norms of international customary law", according to media reports. (BBC)

Currencies

Dollar Jumps To Nearly 7-Week High Vs. Yen. The U.S. dollar on Tuesday jumped against the Japanese yen as the market responded to diplomatic efforts to avert a U.S. military strike against Syria and strong retail and industrial data in China. The dollar rose to 100.33 yen from 99.59 yen late Monday. The move marked the dollar’s highest level against the yen since July 24, according to FactSet data. The ICE dollar index, which measures the dollar against a basket of six other currencies, was slightly higher at 81.817, compared to 81.791 late Monday in North America. The Australian dollar rose to 93.09 U.S. cents, its highest level since mid June, from 92.28 U.S. cents late Monday. In other major currencies, the euro traded at $1.3267, near $1.3260 late Monday, while the British pound edged up to $1.5729 from $1.5701. (Market Watch)