Malaysia

Bank Negara Reserves At RM424.2b. Bank Negara Malaysia’s international reserves stood at RM424.2bil (US$132bil) as at August 29 this year. The reserves position is sufficient to finance up to nine months of retained imports and is 1.2 times the short-term external debt, it said in a statement yesterday. (NST)

Asia

Japanese Economy Contracts More Than Initial Estimate On Tax. Japan’s economy contracted the most in more than five years, highlighting the challenge for Prime Minister Shinzo Abe in steering the nation through the aftermath of a salestax increase. Gross domestic product shrank an annualized 7.1% in the three months through June, the most since the first quarter of 2009, the Cabinet Office said today in Tokyo. The median forecast of 25 economists surveyed by Bloomberg News was for a 7% drop. Companies’ capital investment dropped 5.1% from the previous quarter, more than double the initial estimate for a 2.5% decline. Private consumption was revised to a 5.1% decline from an initial reading of a 5% fall. (Bloomberg)

Japan Service Sector Sentiment Worsens In August. Japan's service sector sentiment index fell to 47.4 in August, down for the first time in four months, a Cabinet Office survey showed on Monday. The survey of workers such as taxi drivers, hotel workersand restaurant staff - called "economy watchers" for their proximity to consumer and retail trends – showed their confidence about current economic conditions declined from 51.3 in July. The outlook index, indicating the level of confidence infuture conditions, was down at 50.4 from 51.5 in July. (Reuters)

China Posts Record Surplus As Exports-Imports Diverge. China’s trade surplus climbed to a record in August as exports rose on the back of increased shipments to the U.S. and Europe, while imports fell for a second month as a property slump hurt domestic demand. Exports increased 9.4% from a year earlier, the Beijing-based customs administration said today, compared with the 9% median estimate in a Bloomberg survey. Imports unexpectedly dropped 2.4%, leaving a trade surplus of $49.8bil. Exports to the U.S. climbed 11.4% in August from a year earlier, while shipments to the European Union increased 12.1%, according to government data compiled by Bloomberg. Imports from the U.S. declined 3.1%. (Bloomberg)

USA

Consumer Credit In U.S. Surges On More Loans For Automobiles. Consumer borrowing in the U.S. rose more than forecast in July as non-revolving loans including those for cars climbed by the most in three years. The $26bil increase in credit and exceeded the highest forecast in a Bloomberg survey and followed an $18.8bil advance in June that was more than previously estimated, a report from the Federal Reserve in Washington showed today. Non-revolving loans, which include borrowing for autos and college tuition, climbed $20.6bil, the biggest gain since July 2011. Credit-card lending rose for a fifth straight month. (Bloomberg)

Europe

Sentix Euro Zone Index Slides In September Despite ECB Measures. Sentiment in the euro zone fell for a second straight month to its lowest level in more than a year in September, suggesting the single currency bloc will fall back into recession, a survey by Sentix showed on Monday. Sentix research group's index tracking morale among investors in the euro zone dropped to -9.8 in September, its weakest reading since July 2013, from 2.7 in August. That undershot by far the consensus forecast in a Reuters poll for a reading of 2.0. (Reuters)

UK Retail Sales Growth Accelerates In August. Surging clothing and footwear sales helped British retail sales accelerate sharply in August, according to figures from the British Retail Consortium (BRC) on Tuesday. Total retail spending was 2.7% higher than a year ago, up from 1.3% in July. The BRC said this was the best performance since January, excluding the effects of the timing of Easter holidays. Sales on a like-for-like basis - a measure which strips out changes in floor space and is favored by equity analysts - rose 1.3% on the year, beating expectations of a 0.5% rise and up from a 0.3% decline in July. (Reuters)

Germany’s Trade Surplus And Exports Reach All-Time Highs. German exports rose above 100bil euros ($129bil) for the first time in July and the trade surplus climbed to an all-time high, even as escalating sanctions against Russia threatened trade flows. Exports gained the most in more than two years, climbing 4.7% from June to 101bil euros, data from the Federal Statistics Office in Wiesbaden showed today. The trade gap widened to 23.4bil euros from 16.6bil euros. Imports slid 1.8% in July, today’s report showed. The current account surplus widened to 21.7bil euros from 17.2bil euros. (Bloomberg)

IMF's Lagarde Urges Germany To Spend More, Aid Recovery. International Monetary Fund (IMF) head Christine Lagarde urged Germany to increase investments to help spur the euro zone's flagging economic recovery, adding that the bloc as a whole needed to make more structural reforms. With the euro zone economy in the doldrums, the European Central Bank announced on Thursday a series of measures to stimulate growth, with its president Mario Draghi expanding on a call for governments to support this process with extra spending. Echoing that sentiment, Lagarde told daily Les Echos in an interview the process could be aided by Germany, which is borrowing at record-low rates and on track to record a public sector surplus for the third year running. (Reuters)

Spain House Prices Rise For First Time In Six Years. House prices in Spain rose by 0.8% year-on-year in the second quarter of 2014, compared with a 1.6% fall in the first quarter, the first annual rise in six years, data from the National Statistics Institute (INE) showed on Monday. The indicator is the latest sign of the country's economic recovery. The prices of newly built houses rose most, up 1.9%, while "second-hand" houses rose 0.2%, the highest increase since the fourth quarter of 2007. Earlier this month data from real estate website Fotocasa.es showed a monthly increase of 1%, the largest rise in eight years. (Reuters)

Currencies

Pound Falls On Scottish Referendum Jitters; Dollar Gains. The British pound took a fresh dive on Monday, sliding to levels not seen in 10 months, after a weekend poll showed voters favoring Scottish independence pushing ahead of those against. The pound was down 1.3% in recent trading to $1.6110, a level not seen since November 2013. In late North American trade on Friday, the pound traded at $1.6328. Among other exchange rates, the dollar rose to ¥106.01 compared with ¥105.09 late Friday in New York. The euro was down to $1.2901 from $1.2949 late Friday in New York. The ICE dollar index which tracks the greenback against a basket of major currencies, advanced to 84.278, up from 83.753 on Friday. (Market Watch)

Commodities

Brent, U.S. Oil Fall Again On Weak Data. Brent crude fell $1 to below $100 a barrel on Monday for the first time in more than a year as Chinese and U.S. data pointed to slower-than-expected growth in the world's top oil consumers, while U.S. crude also fell. Brent fell $1 to $99.82 by 11:33 a.m. EDT (11:33 a.m. EDT), rebounding slightly from an earlier low of $99.36 a barrel, its lowest since May 1, 2013. U.S. crude fell 98 cents to $92.31 a barrel, after settling at $93.29 on Friday for its sixth weekly drop in seven weeks after disappointing U.S. nonfarm payrolls data cast doubt on the pace of growth in the world's biggest oil-consuming economy. (Reuters)

Gold Drops 1.2 Pct, Hits Three-Month Low As Dollar Gains. Gold fell more than 1% to a fresh three-month low on Monday as the dollar's rally against a basket of major currencies decreased bullion's appeal as a currency hedge. Spot gold was down 1.2% to $1,253.91 an ounce by 3:06 p.m. EDT (1906 GMT), having earlier traded as low as $1,251.24, marking the lowest since June 10. Among other precious metals, spot silver fell 1% to $18.95 an ounce. Platinum dropped 0.7% to $1,391.20 an ounce, while palladium was down 0.4% to $880.70 an ounce. (Reuters)