Malaysia

M'sian Banks Vulnerable To Falling Household Health. Malaysian banks are particularly vulnerable to deterioration in household health, given that the household sector accounts for about 57% of the banking system’s total loans, a report by Standard & Poor’s Rating Services (S&P) shows. S&P analysts Ivan Tan and Deepali V Seth Chhabria said a prolonged run-up in housing prices and household debt in Malaysia had contributed to growing economic imbalances in the country. They pointed out that credit risks were also high, given Malaysia’s fairly large private-sector debt burden relative to the country’s modest income levels. “S&P anticipates that major Malaysian banks’ generally healthy financial positions, including sufficient capital and liquidity buffers, will mitigate the potential credit risk from high household debt and escalating property prices,” they said. They added that government support also underpinned the ratings on many banks. (The Star)

Asia

India Car Sales Fall In January, No Respite Seen. Car sales in India fell 7.6% in January, the fourth straight month of decline, according to figures released by the Society of Indian Automobile Manufacturers (SIAM), in a market set to fall for the second straight year. Car sales fell to 160,289 vehicles. Last month, the industry body said, as consumers kept a tight lid on spending, hurt by high interest rates and fuel costs in a slowing economy. Sales have fallen 5.2% so far this fiscal year that ends in March. "There is no respite," said Sugato Sen, SIAM's deputy director general. Demand for cars has fallen, particularly in urban areas, with the economy growing at its slowest pace in a decade. (Reuters)

USA

House Votes To Suspend U.S. Debt Limit Until March 2015. The House of Representatives voted to suspend the U.S. debt limit until March 2015, giving a win to President Barack Obama and Democrats in Congress who insisted that the ceiling be lifted without conditions. The measure passed today 221-201. The plan goes to the Democratic-led Senate, where Majority Leader Harry Reid said the chamber will act as soon as possible. Obama and Senate Democrats had refused to negotiate on raising the debt limit, and U.S. companies sought assurance that the government wouldn’t exhaust its borrowing authority. (Bloomberg)

Yellen: Federal Reserve Stimulus Cuts To Continue. The new chair of the Federal Reserve, Janet Yellen, has said the bank will continue to cut its stimulus measures for the US economy. If the US economy keeps improving, the bank would take "further measured steps" to reduce its support, she said. In her first comments since taking over, Ms Yellen also signalled that interest rates would remain low. Her testimony signals a continuation of the policies started under her predecessor, Ben Bernanke. While Ms Yellen noted the recent volatility in global financial markets, she said that at this stage it did not "not pose a substantial risk to the US economic outlook". (BBC)

Job Openings In U.S. Decrease In December As Hiring Slows. Job openings in the U.S. fell in December from an almost six-year high and hiring slowed, a sign the labor market cooled at the end of the year. The number of positions waiting to be filled declined by 43,000 to 3.99 million, from a revised 4.03 million the prior month, the Labor Department said today in Washington. Fewer Americans quit their jobs. (Bloomberg)

US Inventories Post Slim Gain In December. U.S. wholesale inventories rose less than expected in December, suggesting a moderation in the pace of stock accumulation at the end of the year that could see fourth-quarter growth estimates trimmed. The Commerce Department said on Tuesday wholesale inventories increased 0.3 % after an unrevised 0.5 % gain in November. Economists polled by Reuters forecast stocks at wholesalers rising 0.5 % in December. For all of 2013, wholesale inventories increased 3.9 %. Inventories are a key component of gross domestic product changes. Excluding autos, wholesale inventories advanced 0.3 % in December. This component goes into the calculation of GDP. (Reuters)

US Small Businesses Upbeat On The Economy. Optimism among owners of small business in the U.S. crept higher in January, continuing a trend, amid hopes for higher sales. The National Federation of Independent Business's small business optimism index rose to 94.1 from 93.9 the previous month. It was the third straight month in a row that the index has improved. Despite the upbeat direction, the NFIB said in a statement that the "index is still just treading water." The industry group said its real sales expectations subindex jumped to 15 % in the month. Hopes for an increase in sales resulted in expectations of a pick up in hiring. (CNBC)

Europe

CBI: UK Seeing 'Right Kind Of Growth'. The UK economy is starting to see the right kind of growth, says employers' organisation the CBI. "Our forecast shows encouraging signs that business investment and net trade are starting to play their part," said CBI boss John Cridland. He said the recovery was not a "debt-fuelled, housing bubble-led recovery", as some economists have feared. However, Mr Cridland warned that political uncertainty ahead of the election could be a real "mood killer". In line with other forecasters, the business group also upgraded its growth forecast for this year to 2.6%, up from 2.4% in November and said that it saw "no prospect" of an interest rate rise until late in 2015. (BBC)

Currencies

Kazakhstan Says To Devalue Currency By 19%. Kazakhstan said on Tuesday it would allow its national tenge currency to devalue by 19% to about 185 per dollar because of a decline in other emerging market currencies and in order to try to prevent large-scale speculation on the forex market. Shortly after the announcement by the central bank, the official rate of the tenge fell to 163.90 to the dollar from 155.56 on Monday. The bank said it would ease support of the tenge and reduce currency interventions. It said its decision was coming into force immediately. The bank said its move had been prompted by volatility on international markets caused by the US Federal Reserve System's gradual withdrawal of its quantitative easing policy. (Reuters)

Dollar Falls Vs. Pound, Aussie; Rises Against Yen. The dollar fell against the British pound and Australian dollar Tuesday after data supported growth in the U.K. and Australia, while investors digested testimony from Federal Reserve Chairwoman Janet Yellen. The British pound advanced to $1.6450 from $1.6408 late Monday. The Australian dollar jumped to 90.38 U.S. cents from 89.46 U.S. cents after an upbeat reading on business confidence. The dollar rose to ¥102.64 from ¥102.21 late Monday. The ICE dollar index , a measure of the greenback’s strength against six other currencies, was at 80.634 versus 80.630 late Monday. The euro was at $1.3640 from $1.3645. (Market Watch)

Commodities

Brent Rises Modestly On Weather-Related Demand For Heating Oil, Gasoline. Brent oil rose slightly on Tuesday supported by demand for U.S. heating oil and gasoline, which gained on expectations that persistent cold weather in the United States will lead to another large draw in distillates. Brent crude settled five cents higher at $108.68, after settling 94 cents lower in the previous session. U.S. crude ended the day 12 cents lower at $99.94, but rose as much as 55 cents to $100.49 after the API data were released. (Reuters)

Gold Rises 1.4 Pct To Three-Month High After Yellen Comments. Gold rose to a three-month high on Tuesday, gaining nearly 1.5 % after incoming Federal Reserve Chair Janet Yellen made it clear she would not make any abrupt changes to the central bank's commitment to a measured tapering of bond purchases. Spot gold was up 1.4 % at $1,291.51 an ounce by 3:11 p.m. EST (2011 GMT), its biggest one-day gain in three weeks. Among other precious metals, silver gained 0.9% to $20.21 an ounce. Platinum climbed 0.3 % to $1,384.74 an ounce, while palladium rose 0.1 % to $715.30 an ounce. (Reuters)