Global

OECD Sees Gradual World Recovery, Urges ECB To Do More. The global economy will gradually improve over the next two years but Japan will grow less than previously expected while the euro zone struggles with stagnation and an increased deflation risk, the OECD said on Tuesday. There will be marked divergences among countries both in terms of growth and monetary policy, leading to volatility in debt and foreign exchange markets, the Organisation for Economic Co-operation and Development said. Overall, the global economy is set to grow by 3.3% this year, 3.7% in 2015 and 3.9% in 2016, the OECD said, confirming forecasts published before the G20's summit earlier this month. While most estimates remained unchanged, Japan's forecast was more than halved for 2014 and cut to 0.8% for next year after it unexpectedly fell into recession in the third quarter. But the OECD still expects Japan to recover as corporate profits remain high and a weak yen will help exports. A bigger worry for the Paris-based think-tank is the euro area, which it said "may have fallen into a persistent stagnation trap". "The euro area is at risk of deflation if growth stagnates or if inflation expectations fall further," it said. Its inflation forecasts of 0.6% for the euro area next year and 1.0% for 2016 are slightly more pessimistic than the EU's own forecasts and far from the European Central Bank's target of just below 2%. The OECD therefore reiterated its call for the ECB to embark on quantitative easing in the euro zone. (Reuters)

Malaysia

IMF: Growth Prospects Still Strong. The International Monetary Fund (IMF) said Malaysia’s growth prospects remain strong but structural reforms may be required to maintain the performance, especially against a backdrop of weaker growth in advanced economies. The IMF, which completed its annual Article IV Mission to Malaysia yesterday, said the country would need “steadfast implementation” of a range of structural reforms, as identified in the Economic Transformation Programme and the 11th Malaysia Plan, to achieve high-income status by 2020. The IMF has projected Malaysia’s gross domestic product (GDP) to grow by close to six% this year before moderating to about 5.25% next year, underpinned by robust domestic demand. (NST)

Malaysia’s September Unemployment Rate Stays At 2.7pc. Malaysia's unemployment rate in September 2014 stayed at 2.7% from the previous month, the Statistics Department said. In a statement on "Labour Force Statistics Malaysia" today, it said the year-on-year comparison showed a change of negative 0.4% from 3.1% in September 2013. The labour force participation rate increased to 67.9% in September as compared to 67.1% in the previous month. (Bernama)

Asia

China Cuts Key Short-Term Money Rate As Beijing Pushes Down Cash Costs. China's central bank cut the yield for a key short-term money rate on Tuesday for the fourth time this year, as regulators step up efforts to reduce funding pressure on Chinese companies. The reduction of the yield on the 14-day bond repurchase agreement (repo) to 3.2%, from 3.4%, follows a surprise cut to benchmark lending rates on Friday to support the cooling economy, and follows similar moves in October and July as growth wobbled. (Reuters)

USA

Consumer Confidence In U.S. Unexpectedly Dropped In November. Consumer confidence unexpectedly declined in November to a five-month low as Americans became less upbeat about the economy and labor market. The Conference Board’s index fell to 88.7 this month from an October reading of 94.1 that was the strongest since October 2007, the New York-based private research group said today. The figure last month was weaker than the most pessimistic estimate in a Bloomberg survey of economists. (Bloomberg)

Home Prices In 20 U.S. Cities Increase At A Slower Pace. Home prices in 20 U.S. cities advanced at a slower pace in the 12 months through September as the housing market continued to make gradual progress. The S&P/Case-Shiller index of property values increased 4.9% from September 2013, the smallest gain since October 2012, after rising 5.6% in the year ended in August, the group reported today in New York. Nationwide, prices rose 4.8% after a 5.1% year-to-year increase a month earlier. (Bloomberg)

US Economy Grows Faster Than First Forecast. The US economy grew much faster in the third quarter than first reported, official figures have shown. It expanded at an annualised rate of 3.9% between July and September, up from the 3.5% first estimated by the Bureau of Economic Analysis. The rise, which follows a strong second quarter, means the US has seen its strongest two consecutive quarters of growth for a decade. Consumer spending was the biggest driver of the raised estimate. It grew by 2.2% according to the latest estimate, which was higher than the initial calculation of 1.8%. (BBC)

Europe

UK Service Sector Grows Steadily In Three Months To November. The services sector that forms the bulk of Britain's economy grew steadily in the three months to November, but companies are growing less optimistic about the outlook, a survey published on Tuesday showed. The Confederation of British Industry's quarterly survey revealed continued growth in profits and increased employment. It also showed expenditure on staff training at its highest level in 15 years, possibly reflecting skill shortages ahead. Britain's economy looks set to slow in the fourth quarter of 2014, but the pace of growth is expected to remain robust. (Reuters)

Jump In Private Consumption Helps Germany Avoid Recession In Third Quarter. A sharp rise in private consumption more than compensated for stubborn weakness in investment to help the German economy post modest growth in the third quarter and avoid a technical recession, data showed on Tuesday. The Federal Statistics Office confirmed an earlier flash estimate showing a 0.1% rise in seasonally-adjusted gross domestic product (GDP). Private consumption rose 0.7% quarter-on-quarter, the biggest increase in three years, and public investment rose 0.6%. Overall consumption contributed 0.5%age points to growth, while trade provided modest support. On the downside, investment in equipment tumbled by 2.3%, while gross capital and construction investment also fell. Overall, investment subtracted 0.7%age points from GDP growth in the quarter. (Reuters)

Italy Retail Sales Post Fifth Consecutive Monthly Fall In September. Italian retail sales fell for a fifth straight month in September, data showed on Tuesday, pointing to ongoing stagnation in consumer demand in the recession-bound economy. National statistics institute ISTAT reported that seasonally adjusted retail sales were down 0.1% from the month before, following a 0.2% decline in August. August's data was revised down from an originally reported 0.1% drop. (Reuters)

Currencies

Dollar Weakens Against Rivals After Consumer-Confidence Data. Surprisingly weak consumer confidence data pushed the dollar lower against the yen, euro and pound Tuesday as investors worried that consumers might be tamping down spending ahead of the holiday shopping season. The ICE Dollar Index, a measure of the greenback’s strength against a basket of six rival currencies, was down 0.30% to 87.8940, trading below the 88.0000 level for the first time since Friday. The euro traded at $1.2473, compared to $1.2430 late Monday. The shared currency is the most heavily-weighted component of the dollar index. Elsewhere, the dollar traded at 117.99 yen, surrendering its gains from Monday’s session and returning to its Friday level. The pound traded at $1.5704 against the greenback, marking its second-consecutive session of gains. The Australian dollar traded at 85.24 cents, just above a four-year low reached earlier in the session. (Market Watch)

Commodities

Oil Down 2 Pct As Pre-OPEC Talks Don't Lead To Output Cut. Oil tumbled 2% to near four-year lows on Tuesday in another volatile session as a meeting of Saudi Arabia and three other nations ahead of an OPEC summit ended with no deal to curb crude output. Benchmark Brent crude settled down $1.35 at $78.33, falling from an intraday high of $80.44. U.S. crude finished down $1.69 at $74.09. It fell more than $2 in post-settlement trade, reaching $73.71, near a four-year low of $73.25 hit a little more than a week ago. (Reuters)

Gold Edges Higher As U.S. Dollar Eases; Swiss Vote Eyed. Gold edged up slightly to just above $1,200 an ounce on Tuesday as the U.S. dollar eased after data showed a deterioration in consumer confidence, offsetting better-than-expected U.S. economic growth numbers. At 4:11 p.m. EST (2111 GMT), spot gold was up 0.4% at $1,202.10 an ounce, still not far from a three-week high of $1,207.70 reached on Friday after a surprise rate cut in top consumer China. Platinum gained 2.1% to $1,226.0 an ounce. Silver rose 1.4% to $16.76 an ounce, and palladium also edged 0.4% higher to $797.25 an ounce. (Reuters)