Malaysia

OPR Kept At 3.25%. For the third consecutive meeting, Bank Negara Malaysia (BNM) has decided to keep the Overnight Policy Rate (OPR) at 3.25%. The growth trajectory of the global economy continues to moderate and uncertainties arise moving forward. In the domestic economy, there is continued wariness on the consumption side amidst rising costs of living. We believe that the combination of both global and domestic moderation will keep the OPR at 3.25% for a prolonged period of time, at least until some pick up in consumption once the impact of GST and subsidy rationalization eases sometime towards the end of 2015. (Please refer to Economic Viewpoint for further comments)

Asia

PBOC Confirms New Liquidity Tool As It Holds Off Easing. China’s central bank has published details on its latest tool to provide liquidity as it refrains from across-the-board cuts to benchmark interest rates. The People’s Bank of China confirmed it pumped 769.5b yuan ($126b) into the country’s lenders in the last two months through a newly-created Medium-term Lending Facility. The PBOC injected 500b yuan in September and another 269.5b yuan in October via the facility -- all termed at three months with an interest rate of 3.5%. (Bloomberg)

USA

U.S. Third-Quarter Productivity Beats Forecasts; Pay Increasing. Productivity at U.S. nonfarm businesses increased more than expected in the third quarter, keeping a lid on wage inflation. The Labor Department said on Thursday productivity grew at a 2.0% annual rate after expanding at an upwardly revised 2.9% pace in the second quarter. Economists polled by Reuters had forecast productivity, which measures hourly output per worker, advancing at a 1.5% rate after the second quarter's previously reported 2.3% expansion pace. But the trend in productivity remains sluggish. It rose at only a 0.9% pace compared to the third quarter of 2013. But pay is accelerating, a good sign for the economy. Compensation per hour increased at a 2.3% rate in the third quarter after a similar rise in the prior quarter. Hourly compensation was up 3.3% from a year earlier, the fastest increase since the fourth quarter of 2012. (Reuters)

First-Time Jobless Claims In U.S. Fell More Than Forecast. Fewer Americans are being fired and productivity is showing signs of life, pointing to an improving job market that is helping boost consumer confidence. The number of claims for jobless benefits dropped by 10,000 to 278,000 in the week ended Nov. 1, the Labor Department reported today in Washington. (Bloomberg)

U.S. Small Business Payrolls Flat In October. U.S. small business held the line on hiring last month, with a larger percentage reporting job openings they could not fill, a survey released on Thursday showed. The National Federation of Independent Business said its monthly survey found that on a seasonally adjusted basis there was no net gain in employment among its member firms. The survey of 1502 small firms found, however, that 24% of them said they had job openings they were unable to fill, an increase of 3%age points. (Reuters)

OECD Sees Gradual U.S.-Led Recovery Despite Euro Zone Weakness. The global economy is only gradually picking up momentum as stagnation in the euro zone and growing weakness in some big emerging economies weighs on the U.S.-led recovery, the OECD said on Thursday. The OECD forecast the U.S. economy would see growth speed up from 2.2% this year to 3.1% next year as an improving job market gives private spending a boost. Firming U.S. growth warranted a gradual increase in the Federal Reserve's interest rates from the middle of next year, the OECD said, warning however that hikes could trigger turbulence in emerging markets. (Reuters)

Europe

ECB Promises More Action To Boost Economy If Needed. The president of the European Central Bank (ECB), Mario Draghi, says the bank stands ready to give the eurozone further economic stimulus "should it become necessary". The bank began an asset purchase programme last month, but has come under pressure to do more to boost weak economic growth in the eurozone. The ECB's regular policy meeting left interest rates unchanged at their record low of 0.05%, as expected. Mr Draghi said: "Should it become necessary to further address risks of too prolonged a period of low inflation, the Governing Council is unanimous in its commitment to using additional unconventional instruments within its mandate. "The Governing Council has tasked ECB staff and the relevant Eurosystem (central bank) committees with ensuring the timely preparation of further measures to be implemented if needed." (BBC)

UK Interest Rates Remain At Record Low Of 0.5%. The Bank of England has held UK interest rates at a record low of 0.5% for another month. It has also decided not to extend its quantitative easing programme, designed to stimulate lending in the economy, beyond the £375bn already spent. The Bank's Monetary Policy Committee has held rates at 0.5% since March 2009 in a bid to help economic recovery. Rates were expected to rise early next year, but economists think this will be pushed back due to recent poor news. (BBC)

U.K. Industrial Output Rises More Than Forecast On Oil, Cars. U.K. industrial production rose more than economists forecast in September as oil and transport output bounced back from summer shutdowns. Output increased 0.6% after a drop of 0.1% in August, the Office for National Statistics said today in London. The median estimate of 30 economists in a Bloomberg News survey was for a gain of 0.4%. Manufacturing production rose 0.4%, also more than estimated. (Bloomberg)

German Factory Orders Rise Less Than Forecast As Growth Stalls. German factory orders climbed less than forecast in a sign the euro area’s largest economy may struggle to grow in the second half of the year. Orders, adjusted for seasonal swings and inflation, rose 0.8% in September after a revised decline of 4.2% in August, data from the Economy Ministry in Berlin showed today. Economists predicted an increase of 2.3%, according to the median of 39 estimates in a Bloomberg News survey. Orders fell 1% on the year. (Bloomberg)

Euro Zone Approves Next Bailout Tranche For Cyprus. Euro zone finance ministers on Thursday approved handing out the next tranche of bailout loans for Cyprus after the country met the last two conditions for the payout, a Cypriot official said. To get the 350-million-euro tranche from the European Stability Mechanism, the euro zone bailout fund, Nicosia had to amend laws on foreclosures and forced sales of mortgaged property in line with a deal with its international lenders. (Reuters)

OECD Urges Sizable ECB Purchases As Europe Grinds To Standstill. The Organization for Economic Cooperation and Development urged significant monetary easing for the euro area at a time when the region’s central bankers are increasingly divided in the face of a slowing economy. “Overall, the euro area is grinding to a standstill and poses a major risk to world growth as unemployment remains high and inflation persistently far from target,” OECD Chief Economist Catherine Mann wrote in a report on the global economic outlook. With growth in the global economy accelerating, the euro area is the major laggard, according to OECD forecasts. Growth will be 0.8% this year and 1.1 next year in the euro area, compared with expansions of 2.2% and 3.1% in the U.S., the OECD said. Global growth will be 3.3% in 2014 and 3.7% in 2015, the OECD said. (Bloomberg)

Currencies

Dollar Index Hits 52-Month High For Second Time This Week. The ICE U.S. Dollar Index hit a fresh 52-month high Thursday, the second time this week. The greenback was spurred higher by dovish comments from the European Central Bank, falling oil prices, and tepid data out of the U.K. The index, a measure of the dollar’s strength against a basket of six rival currencies, gained 0.7% to 88.0570 Thursday after rising as high as 88.11. The euro fell steadily against the buck during North American trading, settling at $1.2365 Thursday afternoon, a 26-month low, compared to $1.2487 late Wednesday. Against the yen, the dollar hovered just under a seven-year high reached during the Asia trading day. It traded at 115.20 yen, compared to ¥114.62 late Wednesday. Weak data out of the U.K. pushed the pound to its lowest point against the dollar in a year. It traded at $1.5831, compared to $1.5971 Wednesday, moving in lock step with the euro. (Market Watch)

Commodities

Oil Ends Down Again As Supply Worry, Dollar Strength Weigh. Oil markets fell on Thursday after a one-day spike as worries about high supplies returned to haunt traders, while the dollar pressed on with its rally which weighed on commodities priced in the currency. Oil markets fell on Thursday after a one-day spike as worries about high supplies returned to haunt traders, while the dollar pressed on with its rally which weighed on commodities priced in the currency. At the close, Brent's front-month was down 9 cents at $82.86 a barrel, compared to its 90 cent-fall earlier in the day. U.S. crude finished down 77 cents at $77.91, after tumbling as much as $1.56 during the session. (Reuters)

Gold, Silver Hover Near Multi-Year Lows, Pausing Rout. Gold crawled higher on Thursday, after the prior day's slump in prices to four-year lows tempted some buyers back to the market and as the dollar dipped on profit-taking. Spot gold was up 0.3% at $1,144.30 an ounce at 1433 EST (1933 GMT) in muted trade as investors awaited Friday's U.S. non-farm payrolls data. Silver rose 0.4% at $15.40 an ounce after tumbling over 4% on Wednesday to a 4-1/2 year low of $15.13. Spot platinum was down 1% at $1,192.25 an ounce, and spot palladium fell 1% to $747 an ounce. (Reuters)