Malaysia

Government Seeking Extra Budget Of RM4bil. The Government is seeking an extra budget of RM4.112bil this year to pay for various matters including civil servant wages and fuel subsidies. The additional expenditure was sought under the Supplementary Supply (2014) Bill 2014, which was tabled for the first reading by Deputy Finance Minister Datuk Ahmad Maslan on Monday. The bulk of the extra expenses was sought by the Treasury General Services, which proposed for RM3.082bil in the Bill. (The Star)

More Measures To Liberalise Malaysia's Economy. The Government has announced further liberalisation measures to strengthen the economy and promote investment. This includes lifting the barrier on new foreign unit trust management companies entering Malaysia. This new measure, to take effect immediately, is aimed at making a wider range of competitive products available to investors and increasing competition in the sector. Prime Minister Datuk Seri Najib Tun Razak also announced the removal of the mandatory credit ratings, the liberalisation of equity shareholding for credit-rating agencies and allowing full foreign ownership of international credit-rating agencies in the market. This approach – to promote investment in a broader spectrum of assets and corporate bond markets and enable investors to diversify their portfolios – would take effect on Jan 1, 2017, he said. (The Star)

PM: Govt To Reduce Dependence On Oil, Gas Revenue To 28.9%. Malaysia's move to diversify its economy will see it reducing its dependence on oil and gas revenue while focus will be on the services sector, says Datuk Seri Najib Tun Razak. The Prime Minister said on Monday that in 2008, oil and gas accounted for 39.7% % of total revenue, but this year it is forecast to be 28.9%. "Services now account for 55.2% of GDP, well on the way to our target of 65% by 2020. Inflation is projected to be between 3% and 4%, and we are essentially at full employment," he said at the opening of the Invest Malaysia 2014. (The Star)

Asia

Japan Growth Data Revised Upwards. Japan has revised up its growth figures for the January-to-March period, due to stronger growth in business investment. The Cabinet Office said the economy grew 1.6% during the period, up from its initial estimate of 1.5%. That translates into an annualised growth rate of 6.7% - up from the initial figure of 5.9%. According to the revised figures, business investment rose 7.6% during the period, from the previous quarter, revised up from a preliminary 4.9% increase. Meanwhile, consumer spending climbed 2.2%, up from the initial estimate of a 2.1% gain. (BBC)

China Details Reserve Ratio Cut For Regional Lenders. China’s central bank announced a 0.5 percentage point cut in reserve requirements for some banks, giving details of a policy move aimed at supporting smaller companies and agriculture. The reduction will take effect June 16, the People’s Bank of China said in a statement on its website yesterday. The reduction applies to two-thirds of city commercial banks, 80 % of non-county level rural commercial banks and 90 % of non-county level rural cooperative banks. (Bloomberg)

Indian Government Announces Rapid Economic Reforms. India's new government has unveiled a programme for rapid economic reforms aimed at creating jobs and boosting foreign investment. The announcement by President Pranab Mukherjee included plans designed to simplify taxation and reduce inflation. Industrial reforms included attracting private investment to the coal and defence sectors. He also spoke of India's hopes for good relations with neighbours and pledged to tackle violence against women. (BBC)

Europe

S&P Upgrades Ireland’s Rating, Growth Forecast. Ireland's credit rating was upgraded Friday to A minus with a "positive" outlook by U.S. ratings agency Standard& Poor's (S&P). "The upgrade reflects our view of the brightening prospects for Ireland's domestic economy, which we expect to underpin further improvements in the government's financial profile, capital markets access, and financial system asset quality," the agency said in a news release. The country was previously rated BBB+. S&P said it could raise its rating on Ireland again within the next two years. It also revised up its economic growth forecast for Ireland. It now predicts growth to average 2.7 % between 2014 and 2016, rather than 2.0 %. (CNBC)

UK Retail Sales Growth Eases In May, Pegged Back By Food. British retail sales growth slowed last month after a bumper April, pegged back by slumping food sales, the British Retail Consortium said on Tuesday. The BRC said the amount of money spent in stores last month was 2.0 % higher than a year ago, compared with a 5.7 % rise in April that was boosted by the timing of the Easter holidays. Clothes stores enjoyed the fastest growth since December 2011, the BRC said, but in the food sector the 3-month average year-on-year change turned negative for the first time since records started in 2008. Total spending for the three months to May was 2.3 % higher than a year earlier, as the BRC reported strong big ticket sales on goods like televisions and gaming consoles. (Reuters)

Currencies

Euro At 4-Month Low; Aussie Seen At Parity By Year End. The dollar on Monday rose against the pound and euro, pushing the shared currency to a four-month low. The euro fell to $1.3593 from $1.3641 late Friday, hitting the lowest level since Feb. 12. The ICE dollar index, a gauge of the greenback’s strength against six rivals, rose to 80.624 from 80.425 late Friday. The Australian dollar moved up to 93.56 U.S. cents from 93.34 U.S. cents late Friday. Australian markets were closed Monday. Elsewhere, the pound inched down to $1.6802 from $1.6808 in the prior session. The dollar was unchanged at ¥102.52 from late Friday. (Market Watch)

Commodities

Brent Crude Oil Rises Above $110 On Global Growth Prospects. Brent crude rose on Monday, gaining over $1 to surpass $110 a barrel for the first time in June, while U.S. crude rose by nearly $2, as strong Chinese and U.S. data pointed to healthy economic growth and higher demand for oil from the world's top two consumers. Brent rose by $1.38 a barrel to settle at $109.99, after settling down 18 cents and declining 0.7 % last week. U.S. oil rose by $1.75 a barrel to settle at $104.41. (Reuters)

Platinum Rebounds As Strike Settlement Talks Deadlock. Platinum rose on Monday, rebounding from session lows after the latest round of negotiations to resolve a five-month strike in South Africa's platinum sector ended without an agreement. Spot platinum rose 0.2 % to $1,446 an ounce by 3:40 p.m. EDT (1940 GMT). Spot gold was up 0.1 % to $1,253.06 an ounce. Among other precious metals, silver climbed 0.3 % to $19.03, while palladium eased 0.3 % to $837.80. (Reuters)