Asia Pacific

 Japan Mulls US$50b Stimulus To Offset Tax Rise. Japan is considering US$50 billion in economic stimulus to cushion the blow of a national sales-tax increase that is meant to rein in the government's massive debt, people involved in the decisions said yesterday. Prime Minister Shinzo Abe is set to raise the tax to 8% from 5% in April, rejecting calls by some advisers to delay or water down the fiscal tightening in order to keep the economic recovery on track. The tax hike is the biggest effort in years by the world's thirdlargest economy to contain a public debt, at more than twice the nation's annual economic output, which is the biggest in the world. But Abe has said he must balance the long-term need to balance the budget against his top priority of breaking Japan free from 15 years of deflation and tepid growth. (Reuters)

 Flat Machinery Order A Check On Japanese Optimism. Japan's core machinery orders were unexpectedly flat in July, a weak spot in a run of strong recent data and a reminder that firms are still not confident enough about the economy's recovery to aggressively increase capital expenditure. The monthly change in core orders, which exclude those of ships and electric power utilities, was weaker than a median market forecast for a 2.4% increase, Cabinet Office data showed on Thursday. Orders had fallen 2.7% in June. (Reuters)

 Indonesia Raises Rate To Four-Year High As Rupiah Extends Slide. Bank Indonesia raised its key interest rate for the fourth time since early June to support a weakening currency and cool inflation expectations. Governor Agus Martowardojo and his board increased the reference rate by a quarter of a %age point to 7.25 %, the highest in more than four years. The outcome, announced in Jakarta today, was predicted by four of 23 economists surveyed by Bloomberg News, with three estimating a 50 basis-point move and the rest expecting no change. The central bank also raised the deposit facility rate. (Bloomberg)

 Philippines Holds Rates At Record Low To Support GDP Growth. The Philippines held its benchmark rate at a record low as easing inflation gave policy makers room to support Southeast Asia’s fastest-growing major economy. Bangko Sentral ng Pilipinas kept the interest rate it pays lenders for overnight deposits at 3.5 % for a seventh meeting, according to a statement in Manila today, as forecast by all 19 economists surveyed by Bloomberg News. It also held the rate on special deposit accounts at 2 %. (Bloomberg)

 India Factory Output Unexpectedly Grows As Rajan Fights Slowdown. Indian industrial production unexpectedly rose in July, bolstering new central bank Governor Raghuram Rajan’s fight against a slumping rupee and slowing economic growth. Production at factories and utilities climbed 2.6 % from a year earlier after a revised 1.8 % decline in June, the Central Statistical Office said in New Delhi yesterday. The median of 28 estimates in a Bloomberg News survey was for a 0.9 % fall. Another report yesterday showed consumer prices rose 9.52 % in August from a year earlier. (Bloomberg)

 Australia Jobless Rate At 4-Year High. Australia suffered a surprising drop in employment in August that pushed the jobless rate up to a four year high of 5.8%, a disappointingly soft report that revived the chance of a cut in interest rates and knocked the local dollar lower. The currency skidded by almost one US cent as yesterday’s data from the Australian Bureau of Statistics showed employers shed a net 10,800 workers in August, well below forecasts of a 10,000 increase and a second straight month of losses. (Reuters)

Americas

 U.S. Consumer Comfort Steadies After Four-Week Fall. Confidence among American consumers stabilized last week after four straight declines even as their views of the economy deteriorated. The Bloomberg Consumer Comfort Index rose to minus 32.1 in the week ended Sept. 8 from minus 32.3. The drop was within the survey’s margin of error of 3 %age points. A measure of households’ assessment of the economy fell to the lowest level since mid-May. (Bloomberg)

 U.S. Budget Gap Narrows As Stronger Growth Boosts Revenue. The U.S. budget deficit narrowed in August from a year earlier as a stronger job market boosted revenue, propelling the world’s largest economy toward its smallest annual shortfall since 2008. Outlays exceeded receipts by $147.9 billion last month, compared with a $190.5 billion gap in August 2012, the Treasury Department said today in Washington. In the 11 months through the fiscal year that ends Sept. 30, the deficit was $755.3 billion, the narrowest for that period in five years. (Bloomberg)

 U.S. Initial Jobless Claims Slump As Two States Underreport. Jobless claims in the U.S. declined last week to the lowest level since April 2006 as work on computer systems in two states caused those employment agencies to report fewer applications. Firsttime claims for unemployment insurance fell by 31,000 to 292,000 in the week ended Sept. 7, which also included the Labor Day holiday, a Labor Department report showed today in Washington. The median forecast in a Bloomberg survey called for 330,000 applications. (Bloomberg)

 Brazil July Retail Sales Rise Ten Times Faster Than Forecast. Brazil’s July retail sales rose almost 10 times faster than economists forecast, adding pressure on the central bank to keep raising borrowing costs. Swap rates jumped. Sales rose 1.9 % from the previous month, after rising a revised 0.4 % in June, the national statistics agency said today in Rio de Janeiro. The number was higher than all but one forecast from 30 economists surveyed by Bloomberg, whose median estimate was for a 0.2 % increase. Retail sales jumped 6% from the same month last year, above the median forecast for a 3.1 % rise. (Bloomberg)

Europe

 Euro-Area Industrial Output Declines More Than Forecast. Euro-area industrial output contracted more than economists forecast in July as manufacturers struggled to shake off the legacy of a record-long recession. Factory production in the 17-nation euro area fell 1.5 % from June, when it gained 0.6 %, the European Union’s statistics office in Luxembourg said today. That’s more than the 0.3 % contraction forecast by economists, according to the median of 33 estimates in a Bloomberg News survey. In the year, output fell 2.1%. Production in Germany, Europe’s largest economy, declined 2.3 % in July after a 2.2 % gain in June, today’s report showed. Output in France fell 0.6 %, while Italian industrial production unexpectedly declined 1.1 %, signaling that the euro area’s thirdbiggest economy may still be stuck in its longest recession since World War II. (Bloomberg)

Currencies

 Dollar Steady As Focus Shifts To Fed Meeting. The U.S. dollar was little changed on Thursday, halting a win streak for the British pound and euro. The ICE dollar index, a measure of the greenback’s strength against six rivals, was essentially steady at 81.513 from 81.517 on Wednesday. The euro edged down to $1.3298 from $1.3308 late Wednesday, while the pound fell slightly to $1.5803 from $1.5823. Both currencies had gained for the four consecutive sessions before Thursday. The Australian dollar fell to 92.60 U.S. cents from 93.30 U.S. cents late Wednesday in North America, which had marked its highest level since mid-June. In other action, the dollar fell to 99.44 Japanese yen from ¥99.95 late Wednesday. A top Japanese official said Thursday Prime Minister Shinzo Abe has made no decision about a sales-tax hike. (Market Watch)

Commodities

 Oil Rises For Second Day As Investors Watch Syria. Global oil prices rose for a second straight day on Thursday as investors monitored diplomatic efforts to eliminate Syria's chemical weapons and Libya declared force majeure on another three ports. Benchmark Brent crude oil for October, which expires on Friday, rose $1.13 to settle at $112.63. The contract for November delivery rose $1.34 to settle at $111.53. Brent had scaled six-month highs of $117.34 a barrel on Aug. 28, partly on rising Syria tensions. U.S. crude rose $1.04 to settle at $108.60. (Reuters)

 Gold Falls 3 Pct After Sudden Early Drop Saps Momentum. Gold dropped 3 % on Thursday, as a sudden price tumble in the futures market shattered investor confidence, sending the metal to its biggest one-day drop in more than two months. Spot gold dropped 3% to $1,325.55 an ounce by at 3:01 p.m. EDT (1901 GMT), for its biggest one-day fall since June 26. Earlier, the metal hit $1,324.24, its weakest since Aug. 15. Among other precious metals, silver was trading down 5.4 % at $21.92. It has lost 8 % so far this week. Platinum dropped 2 % to $1,437 an ounce, while palladium fell 0.3 % to $688.47 an ounce. (Reuters)