Malaysia

PM Announces 11 Measures To Slash Public Sector Spending. The Government announced 11 cost-cutting measures for the public sector in line with its intention to practice of more prudent spending in 2014. The measures, which range from cutting the entertainment and toll allowances of Ministers and Deputy Ministers to reducing the supply of food and drinks in the organising of all official government events will come into effect on Jan 1, the Prime Minister said in a statement on Monday. “The measures are in line with the Government’s intention to practise more prudent spending next year (2014),” Datuk Seri Najib Tun Razak said in the statement. (The Star)

Asia

Asia Pac Syndicated Loans Hit Record US$462bil. Syndicated lending in Asia Pacific (excluding Japan) hit a record high of $462 billion in 2013, showing an increase of 51 % on $307 billion in 2012, as demand from Chinese companies doubled, according to Thomson Reuters LPC data. Southeast Asia's loan markets shrugged off macroeconomic weakness and currency depreciation in India and Indonesia and volume rose 51 % to $80 billion from $52.6 billion in 2012. Malaysia, Philippines and Thailand also set new loan volume records. Asia saw more jumbo multibillion dollar loans in 2013 and average loan sizes of roughly $400 million were 20 % bigger than in 2012. (Reuters)

China’s Local Debt Swells To 17.9 Trillion Yuan In Audit. China’s local-government debt swelled to 17.9 trillion yuan ($2.95 trillion), underscoring risks to the financial system as President Xi Jinping rolls out economic reforms. Debt including contingent liabilities rose about 13 % in the six months through June, based on figures in a report by the National Audit Office, posted on its website yesterday. That followed a 48% increase over the previous two years. (Bloomberg)

S. Korea Industrial Output Unchanged In Nov. South Korea's industrial output for November was unchanged from October as falling auto production offset the increase in memory chips and petrochemical products, state data showed Monday. Production in the mining, manufacturing, gas and electricity industries remained flat, after growing at their fastest pace for 11 months in October, Statistics Korea said. Compared with a year earlier, output in November rose 1.3%. October's figure was the fastest monthly growth since November 2012. (AFP)

S. Korea, China Alarmed As Yen Continues Slide. China and South Korea's anxiety over the rapidly falling yen came to the fore on Monday as senior officials said their exporters could be hurt by Japan's attempts to pull its moribund economy out of a two-decade slump. Beijing and Seoul understand the need for Tokyo to revive its US$5tril economy and escape persistent deflation. But they are worried that the massive monetary and fiscal stimulus championed by Japanese Prime Minister Shinzo Abe has sharply weakened the yen and put their exporters at a disadvantage in global markets. (Reuters)

USA

Pending Sales Of U.S. Existing Homes Rise Less Than Forecast. Contracts to purchase previously owned U.S. homes rose less than forecast in November, indicating higher borrowing costs are holding back the recovery in residential real estate. A gauge of pending home sales increased 0.2 %, the first gain in six months, after a 1.2 % drop in October that was larger than initially reported, the National Association of Realtors said today in Washington. The median projection in a Bloomberg survey of economists called for a 1 % advance. (Bloomberg)

Europe

Merkel Says Balanced Budget, Energy Take Priority In Third Term. German Chancellor Angela Merkel said eliminating the budget deficit and completing the country’s transformation from coal and nuclear energy to renewables are the priorities of her third four-year term. “Especially important to me is that we hand our finances over to the next generation in an orderly way” and “that we bring the energy switch to a successful conclusion,” Merkel said in her New Year’s speech, prepared for delivery later today, that was e-mailed in advance to reporters. While Germany is doing well amid tough global competition and more people than ever have a job, the nation’s progress depends on advances in Europe and overcoming the government debt crisis plaguing the continent, Merkel said. (Bloomberg)

Currencies

Dollar Drops As Treasury Yields Edge Lower. The dollar dropped against the euro and other major currencies on Monday as Treasury yields edged lower. The ICE dollar index, which compares the U.S. unit to a basket of six other currencies, dropped to 80.009 from 80.369 late Friday. The dollar stuck near late Friday’s levels, trading at ¥105.10 versus ¥105.15. The euro rose to $1.3800 from late Friday’s $1.3742, while the Australian dollar gained to 89.11 U.S. cents from 88.70 U.S. cents. The British pound rose to $1.6515 from late Friday’s $1.6469. (Market Watch)

Commodities

Brent Falls On Signs Of Libyan Oil Recovery; China Debt. Crude oil futures tumbled on both sides of the Atlantic on Monday on early signals that oil output in Libya may be starting to recover and concerns over a buildup in local government debt in China, the world's second-largest oil consumer. Brent crude shed 97 cents to settle at $111.21 a barrel after earlier hitting a low of $110.90. U.S. crude fell $1.03 to settle at $99.29. (Reuters)

Gold Below $1,200/Oz; Set For Biggest Loss In Decades. Gold fell over 1 % to under $1,200 an ounce on Monday, heading for its biggest annual loss in more than three decades at nearly 30 %, as a willingness to take on more risk and the prospect of a global recovery tarnished bullion's shine. Spot gold fell to a session low of $1,194.99 an ounce in late afternoon trading in New York and was down 1.4 % at $1,195.96.40 at 4:36 p.m. EDT (2136 GMT). Silver fell 2.4 % to $19.56 an ounce. Spot platinum was down 1.2 % at $1,355.50 an ounce, snapping four consecutive sessions of gains. Spot palladium was down 0.25 % to $705.96 an ounce. (Reuters)