Global

IMF To Raise Its Global Growth Forecast. The International Monetary Fund will raise its forecast for global growth according to its managing director, Christine Lagarde. She said the revision would come in the next three weeks but did not elaborate, saying that it would be premature to say any more. In October the IMF lowered its growth forecasts, saying the global economy "remains in low gear". It cut its growth forecast for 2014 by 0.2 of a percentage point to 3.6%. It also reduced the estimate for 2013 growth by 0.3 of a point to 2.9%. Back then it warned that a slower pace of expansion in emerging economies such as Brazil, China and India, was holding back global expansion. Many economists have been surprised at the strength of the rebound in developed economies, particularly the United States and the UK. (BBC)

Asia

China Plans New Privately Financed Banks. Up to five private banks will be created in China this year as it looks to open up the financial sector and raise competition in the industry. The banks will be allowed to operate on a trial basis under the supervision of Chinese banking authorities. Private finance will be used to either restructure existing banks or set up new ones "bearing their own risks". China has been looking to open up its tightly-controlled financial sector to spur a fresh wave of economic growth. (BBC)

North America

Oil Tumble Sends U.S. Trade Gap To Four-Year Low. A plunge in oil imports pushed the trade deficit in November to the lowest level in four years, showing the U.S. economy is becoming more energy independent. The gap narrowed 12.9% to $34.3 billion, smaller than projected by any economist surveyed by Bloomberg and the least since October 2009, figures from the Commerce Department showed today in Washington. Petroleum imports were the weakest in three years as advances in domestic extraction put the U.S. on track to become the world’s largest oil producer by 2015. (Bloomberg)

Surprise Canada Trade Gap And Spending Drop Hurt Currency. Canada unexpectedly reported a return to large merchandise trade deficits and a decline in business investment, pushing the dollar to the weakest in three years and suggesting a transition away from consumer spending as the primary economic growth driver is further delayed. The trade shortfall widened in November to C$940 million ($875 million) as imports of machinery and equipment increased, Statistics Canada said today in Ottawa. The deficit was nine times wider than the C$100-million median forecast in a Bloomberg News survey. Western University said its Ivey purchasing managers’ index fell to 46.3 in December, the lowest since May 2009. Economists had projected an increase from the November reading of 53.7. (Bloomberg)

Europe

German Unemployment Drops As Euro-Area Inflation Slows. German unemployment fell for the first time in five months in December, signaling increased confidence by the nation’s companies even as pricing power in the euro area remained subdued. The number of people out of work in Europe’s largest economy decreased by a seasonally adjusted 15,000 to 2.965 million, the Nuremberg-based Federal Labor Agency said today. Euro-area inflation slowed to 0.8 %, a separate report from the European Union’s statistics office in Luxembourg showed. German stocks and European bonds advanced. (Bloomberg)

Currencies

Dollar Rises As Investors Wait For FOMC Minutes. The dollar rose against most rivals on Tuesday as investors awaited the next day’s release of minutes from the Federal Reserve’s December meeting. The ICE dollar index, a gauge of the U.S. unit against a trade-weighted basket of six other currencies, rose to 80.864 from 80.664 late Monday. The dollar rose to ¥104.56 from ¥104.17 late Monday. The euro inched down to $1.3613 from $1.3631 late Monday. The Australian dollar moved lower to 89.25 U.S. cents from 89.65 U.S. cents. The British pound was little changed at $1.6396 from $1.6400 late in the previous session. (Market Watch)

Commodities

Brent Rebounds Above $107 As Libya Conflict Escalates. Brent oil futures climbed above $107 a barrel on Tuesday after five consecutive sessions of losses, as investors weighed mixed signals from Libya and as cold weather across the central United States threatened production. Brent crude for February delivery had gained 54 cents to $107.27 by 0659 GMT, after settling lower in the previous five sessions, partly on expectations of rising Libyan exports. U.S. crude was 22 cents higher at $93.65 a barrel. The contract has also fallen in the past five sessions and settled 53 cents lower on Monday. (Market Watch)

Gold Drops After 5-Day Rally, Hit By Strong Equities, Dollar. Gold fell on Tuesday, as a stronger dollar and rebound in U.S. stock prices prompted investors to take profits in bullion after five straight sessions of gains. Spot gold fell 0.5 % to $1,231.50 an ounce by 3:28 p.m. EST (2028 GMT). Silver, whose price tends to be more volatile than gold, fell 1.7 % to $19.81 an ounce, well below a four-week high of $20.33 in the previous session. Platinum was down 0.2 % at $1,409.74 an ounce, having risen to a seven-week high of $1,420.75 on Monday, while palladium gained 0.4 % at $738.25 an ounce. (Reuters)