Asia

Bank Of Japan Stands Pat Despite Grim GDP. The Bank of Japan kept monetary settings and its upbeat economic view unchanged on Wednesday in the wake of data showing the economy has slipped into recession, preferring to spend more time to gauge the effect of its surprise easing last month. As widely expected, the BOJ voted to continue its purchases of government bonds and risky assets, maintaining its pledge of increasing base money, or cash and deposits at the central bank, at an annual pace of 80 trillion yen ($683b). "Japan's economy continues to recover moderately as a trend, although some weaknesses remain mainly in output," the BOJ said in a statement after its policy meeting. It revised up its view on exports to say they were "flat," compared with last month's assessment that they were weakening. (Reuters)

OECD Ups India Growth Outlook, Urges Structural Reforms. India's economy will accelerate in 2015/16 but will fail to attain the heady growth rates of the past decade without sweeping structural reforms, the Organisation for Economic Cooperation and Development said on Wednesday. In a country survey, the Paris-based think tank forecast that Asia's third-largest economy would grow by 6.6% in 2015/16, up from its last forecast of 5.7% growth in May. Growth would edge higher to 6.8% in 2016/17, it said. In its latest forecast, the OECD said it expected inflation to fall to 5.4% in 2015/16 and nudge higher to 5.6% the following fiscal year, after 6.9% in 2014/15. In May, it forecast that inflation would remain above 6% over the next few years. "Structural reforms would raise India's economic growth. In their absence, however, growth will remain below the 8% achieved during the previous decade," the OECD said in the 158-page report. (Reuters)

USA

Single-Family Housing Starts In U.S. Rise Along With Permits. Groundbreaking for single-family homes climbed in October and permits for all future projects reached a six-year high to signal construction will add to U.S. economic growth in early 2015. Starts of one-family houses advanced 4.2% to a 696,000 annualized rate last month, the most since November 2013, Commerce Department figures showed today in Washington. A drop in the construction of apartments pushed total starts down 2.8% to a 1.01 million pace. (Bloomberg)

Fed Officials On Guard For Signs Of Lower Inflation Expectations. Federal Reserve policy makers are on guard for signs that investors and the public are losing confidence in their ability to keep prices stable in a moderate recovery with little wage growth. “Many participants observed the committee should remain attentive to evidence of a possible downward shift in longer-term inflation expectations,” according to a record of the Oct. 28-29 Federal Open Market Committee meeting released today in Washington. “Some of them noted that if such an outcome occurred, it would be even more worrisome if growth faltered.” (Reuters)

Europe

Bank Of England Voted 7-2 To Hold Interest Rates. Persistently low inflation prompted a majority of members on the Bank of England's Monetary Policy Committee to keep interest rates on hold. Seven members voted to keep rates at 0.5%, while two wanted a rise to 0.75%. "For most members, the outlook for inflation in the medium term justified maintaining the current stance of monetary policy," the minutes stated. The minutes stated: "Below-target inflation was judged to be partly the consequence of a margin of spare capacity bearing down on domestic costs and prices. "A prolonged period in which inflation was below the target created at least the possibility that medium-term expectations of inflation would begin to drift downwards. This had the potential to lengthen the period for which inflation itself would remain below 2%." (BBC)

German Exporters See 2015 Growth, Expect More Russia Sanctions. German exports will likely grow by 4% in 2015 if no new global conflicts emerge, even though Western economic sanctions against Russia are likely to last a long time and may expand further, Germany's BGA exporters' group said on Wednesday. "The sanctions will be in place for a long time, we won't get rid of them," said BGA President Anton Boerner. "Rather they will likely get tougher." He said German companies had already lost about a third of their business with Russia and added that decline was expected to continue next year, though he said the sanctions were necessary. Although the German economy has lost growth momentum this year, overall exports have remained largely robust. The BGA repeated its export growth forecast of 3% for 2014. (Reuters)

Bank Of Spain Calls For Increased Deficit Cutting Efforts. Spain must increase budget efforts, especially in the regions, to meet its end-of-year public deficit target as current growth forecasts face risks from the global slowdown, the head of the Bank of Spain said on Wednesday. Spain's public deficit soared to one of the highest in the euro zone after a burst property bubble in 2008 sent the economy into a downward spiral it only emerged from mid-2013. "To meet the deficit target requires an improvement... in income and reduced spending in the last third of the year larger than that seen between January and August," Bank of Spain Governor Linde told the upper house of Parliament. "This increased effort should concentrate on the regions in which, according to available information, the greatest risk of deviation are found." Spain's deficit target of 5.5% of gross domestic product this year was achievable, Linde said, though he warned the 4.2% of GDP target for 2015 would be more difficult. (Reuters)

Currencies

Dollar Surges Past ¥118 After Fed Minutes. The U.S. dollar rocketed past the 118 yen mark Wednesday after minutes from the October meeting of the Federal Open Market Committee reaffirmed that the central bank intends to hike rates toward the end of 2015. It fell as low as 117.57 yen before reversing course and climbing past ¥118 in less than an hour. The greenback has now moved higher against the yen for five consecutive North American trading sessions. It traded at ¥117.12 late Tuesday. In other currency trading, the euro moved higher against the dollar for the second consecutive session, briefly climbing to $1.2605 immediately after the FOMC minutes before falling back to $1.2543. The shared currency traded at $1.2522 late Tuesday. The pound also traded higher against the dollar at $1.5676, compared with $1.5614 Tuesday afternoon. The ICE U.S. Dollar Index a measure of the greenback’s strength against a basket of six currencies, was down 0.12% to 87.4750. (Market Watch)

Commodities

Oil Down On Fed Uncertainty Over U.S. Economy; OPEC In Focus. Oil prices fell for a third straight day on Wednesday, as early gains on talk of a possible OPEC output cut vanished after the Federal Reserve released minutes of last month's policy meeting revealing worries that U.S. inflation could remain below target for "quite some time." Benchmark Brent crude oil settled down 37 cents at $78.10 a barrel, after rising as much as 98 cents during the session. It has lost $1.31 in the past three sessions. U.S. crude finished down 3 cents at $74.61, after a session high at $75.40. (Reuters)

Gold Down 1 Pct On Swiss Referendum Poll, Fed Minutes. Gold fell more than 1% in choppy trade on Wednesday after a poll showed weaker support among Swiss voters for a referendum that would force the central bank to boost its gold reserves. Bullion also came under pressure after the minutes of the Federal Reserve's late October policy meeting showed policymakers were concerned about weakening inflation pressure, dampening the metal's appeal as a hedge. Spot gold was down 1.2% at $1,182.30 an ounce by 3:16 p.m. EST (2016 GMT), off a low of $1,175.50. Silver edged down 0.2% at $16.12 an ounce. Platinum fell 1.2% to $1,187.40 an ounce, while palladium dropped 0.8% to $765 an ounce. (Reuters)