Malaysia

Industrial Production In April Expanded By 4.2% YoY, a slight moderation from 4.3% gained in March. However, it is marginally above market expectations for a 4.1% rise. This is on account of a strong rebound in mining, which mitigated a moderation seen in the manufacturing index. On a monthly comparison, production fell by 3.0% MoM whilst the seasonally adjusted index saw 3.6% MoM increase. For the first four months of the year, industrial production rose by 4.6% YoY, stronger than the 1.4% seen in the same period in 2013. (Please refer to Economic Viewpoint for further comments)

Asia Pacific

China Ramps Up Spending. China’s central bank said it would keep monetary policy steady in 2014, even as the finance ministry said fiscal spending had surged nearly 25% in May from a year earlier, highlighting government efforts to energise the slowing economy. Total fiscal spending in May rose to 1.3 trillion yuan (US$208.75bil), quickening sharply from a 9.6% rise in the first four months of the year. The higher spending comes as the world’s second-biggest economy got off to a soft start to the year, growing at its slowest pace in 18 months in the first quarter. (Reuters)

RBNZ Signals More Tightening After Third Rate Rise. New Zealand’s central bank raised interest rates for the third time this year and signaled more tightening to come as the Christchurch rebuild and elevated commodity prices fuel growth, sending the kiwi higher. “It is important that inflation expectations remain contained and that interest rates return to a more neutral level,” Governor Graeme Wheeler said in a statement in Wellington after increasing the official cash rate by a quarter-percentage point to 3.25 %. The RBNZ left its forecast for the 90-day bank bill rate broadly unchanged, suggesting borrowing costs may rise twice more this year. (Bloomberg)

USA

U.S. Budget Deficit Narrows As Economy, Jobs Boost Revenue. The U.S. posted a $130 billion budget deficit in May and the smallest shortfall for the first eight months of a fiscal year since 2008, as a stronger economy and rising employment bolster revenue. The deficit last month was about $9 billion less than the $139 billion shortfall in May 2013, the Treasury Department said today in Washington. The median estimate in a Bloomberg survey of 20 economists called for a $130.5 billion gap. (Bloomberg)

Europe

UK Unemployment Total Falls To 2.16m. The UK jobs market continued to improve in the three months to April, although the rate of wage increases slowed sharply, official figures show. The number of people out of work fell by 161,000 to 2.16 million, bringing the unemployment rate down to 6.6%.The number of people in work rose by a record 345,000, to 30.5 million, most of which are in full-time employment. But the quarterly rate of earnings growth, including bonuses, slowed to 0.7% from 1.9% the previous month. This was largely due to delayed bonus payments, the Office for National Statistics (ONS) said. Excluding bonuses, pay rose by 0.9%. (BBC)

Currencies

Dollar Falls, Hovers Around 102 Yen. The dollar fell against major rivals Wednesday, hovering around 102 yen. The dollar fell to ¥102.04 from ¥102.33 late Tuesday, pushing below ¥102 during the session. The euro fell to ¥138.08 from ¥138.62 in the prior session, trading at the lowest level since February 5. The euro weakened to $1.3531 from $1.3548 late Tuesday. The ICE Dollar Index, a gauge of the dollar’s strength against six rivals, fell to 80.784 from 80.802 late Tuesday. The pound rose to $1.6791 from $1.6753 late Tuesday. The Australian dollar inched up to 93.84 U.S. cents from 93.75 U.S. cents. (Reuters)

Commodities

Brent Crude Up Near $110 On Iraq Supply Disruption Fears. Brent oil futures climbed toward $110 a barrel on Wednesday as violence in Iraq prompted worries about the supply outlook, while U.S. crude struggled to make gains near key levels of resistance. Brent futures gained 43 cents to settle at $109.95, having earlier hit a high of $110.25. U.S. oil gained 5 cents to settle at $104.40 a barrel, after swinging between $104.17 and $104.81. It had risen to an intraday high of $105.06 on Tuesday, inching close to this year's peak of $105.22 in early March. (Reuters)

Palladium Hits 13-1/2 Year High On Supply Worries. Palladium rallied to its highest level since early 2001 on Wednesday, as lingering supply worries due to a five-month strike in South Africa prompted investor buying. Spot palladium hit a peak of $862.50 an ounce on Wednesday, its highest level since February of 2001. The metal rose 0.8 % to $859.75 an ounce by 3:22 p.m. EDT. Platinum, which gained 2 % in the previous session, was up 0.4 % at $1,479.10. Among other precious metals, gold inched down 14 cents to $1,260.35 an ounce, holding above a four-month low of $1,240.61 hit last week. Silver edged up 0.2 % to $19.15 an ounce. (Reuters)