Global

· IMF Urges G20 To Take Action To Unstick Global Growth. International Monetary Fund chief Christine Lagarde on Friday urged the Group of 20 major economies to fulfill their pledges to revive the faltering global economy. Ahead of next week's G20 finance chiefs meeting in Istanbul, the IMF managing director said they needed to implement the G20 leaders' commitments made at the November summit in Brisbane to boost growth, adding more than US$2 trillion to the global economy and millions of jobs over the next four years. (AFP)

Asia

· Japan's December Economic Index Shows Economy ‘Improving’. Japan's key composite index rose in December following a fall the previous month, the government said Friday, suggesting the country's economy has overcome the negative impact of the 3-percentage-point consumption tax hike to 8% last April. The December index of coincident indicators, such as industrial output, retail sales and new job offers, advanced 1.5 points to 110.7 from the previous month, against the 2010 base of 100, the Cabinet Office said in a preliminary report. The government upgraded its basic assessment of the coincident index, saying it suggests the economy is "improving." (Nikkei)

· China’s Record Trade Surplus Highlights Weak Domestic Demand. China registered a record trade surplus in January as imports plunged on falling commodity prices and weak domestic demand. Imports fell by the most in more than five years, declining 19.9% from a year earlier, the customs administration in Beijing said Sunday. That compared with estimates for a 3.2% drop in a Bloomberg survey of analysts. Exports slid 3.3%, leaving a trade surplus of $60b. (Bloomberg)

· Indonesia Revises 2015 Budget Assumptions, Sees 5.7% Growth. Indonesia's parliament has agreed on changed assumptions for revising its 2015 state budget, including slightly slower growth and higher inflation than were assumed in September, the head of its budget committee said on Friday. The new assumption for GDP growth is 5.7%, compared with the 5.8% used when the previous government in September presented the initial 2015 budget. Ahmadi Noor Supit, committee head, said the parliament's budget committee and the new government also agreed to base the revised budget on annual inflation of 5%, higher than the 4.4% assumed in September. The newly assumed average oil price is US$60, far below the US$105 figure used in September. (Reuters)

USA

· Strong U.S. Job, Wage Gains Open Door To Mid-Year Rate Hike. U.S. job growth rose solidly in January and wages rebounded, a show of economic strength that put a mid-year interest rate increase from the Federal Reserve back on the table. Nonfarm payrolls increased 257,000 last month, the Labor Department said on Friday, outstripping Wall Street forecasts. At the same time, data for November and December was revised to show a whopping 147,000 more jobs created than previously reported, bolstering views consumers will have enough muscle to carry the economy through rough global seas. The unemployment rate rose one-tenth of a percentage point to 5.7%, but that was because Americans poured into the labor force to hunt for work in a show of increased confidence. Wages increased 12 cents last month, the largest gain since June 2007, after falling five cents in December. That took the year-on-year gain to 2.2%, the fastest since August, but still below where Fed officials would like to see it. (Reuters)

· U.S. Budget Deficit Grew Slightly In First Four Months Of FY 2015-CBO. The Congressional Budget Office on Friday forecast a $195b U.S. budget deficit for the first four months of the current fiscal year, up from $183b in the same period last year. The CBO said the $12b increase in the budget gap for the October-January period was largely driven by lower payments to the U.S. Treasury this year from government-controlled mortgage finance groups Fannie Mae and Freddie Mac. Both total receipts and total outlays for the four-month period were up by about 8% over the prior year, the nonpartisan budget agency said. The CBO said it estimated a January 2015 deficit of $19b, nearly double the $10b deficit a year earlier as spending increased for the Social Security and Medicaid benefit programs for older Americans. Spending also rose for student loans, international assistance and health insurance subsidies under the Affordable Care Act, the CBO said. (Reuters)

Europe

· German Industrial Output Rises as Economy Recovers. German industrial production rose for a fourth month in December, adding to signs that an expansion in Europe’s largest economy is gathering pace. Output, adjusted for seasonal swings, was up 0.1% after a revised 0.1% gain in November, a report from the Economy Ministry in Berlin showed on Friday. Production fell 0.7% from a year earlier. The Bundesbank predicts that the economy has overcome its weak phase of early last year, as indicated by a 4.2% jump in factory orders in December and a third consecutive improvement in business confidence in January. The European Central Bank’s quantitative-easing pledge last month will further bolster the economy through a weaker euro exchange rate that’s making exporters more competitive. (Bloomberg)

· UK Trade Deficit Last Year Widest Since 2010. The UK's trade deficit widened last year to £34.8bn, the biggest gap since 2010 according to the Office for National Statistics (ONS). It said a fall in exports was largely to blame for the rising trade deficit. The value of exported goods fell by £14.6bn compared to the previous year. Imports of goods fell for the first time since 2009, down by £7.3bn. For December the deficit widened to £2.9bn from £1.8bn in November, which was more than economists expected. (BBC)

· Greece's Tsipras Defiant Over Economic Plans. Prime Minister Alexis Tsipras of Greece has said he is sticking to plans to roll back austerity and rejecting an international bailout extension. He said Greece, unable to service its debt, would instead seek a bridge loan. He told parliament he would keep all pre-election pledges, promising to raise the minimum wage, pay a pension bonus and rehire public workers. On Sunday, Mr Tsipras said the government's "irreversible decision is to implement in full our pre-elections pledges". The first priority, he said, was "tackling the big wounds of the bailout, tackling the humanitarian crisis". (BBC)

· Moody's Puts Greek Government Bond Rating On Review For Downgrade. Moody's said late on Friday that it was placing Greece's government bond rating of Caa1 on review for downgrade as the agency warned that there was great uncertainty as to the result of talks between the country and its creditors. The move comes after Standard & Poor's cut Greece's long-term sovereign credit rating to B- from B earlier on Friday, warning that liquidity restraints on Greek banks would limit the time the new government has to clinch a deal with its creditors. (Reuters)

· Bank Of Italy Boosts GDP Growth Estimates On ECB Measures. The Bank of Italy raised its economic-growth forecasts for the country after the European Central Bank committed to asset purchases to spur a recovery and inflation across the 19-nation region. Italy’s gross domestic product will expand more than 0.5% this year, governor Ignazio Visco, who sits on the ECB’s Governing Council, said Saturday in a speech at the Assiom Forex conference in Milan. That compares with growth of 0.4% growth projected in a Jan. 16 report by the Italian central bank. The nation’s economy, struggling to emerge from its longest recession on record, is set to benefit from unprecedented ECB stimulus that’ll create more than 1 trillion euros ($1.1 trillion) through quantitative easing. Italian GDP may advance more than 1.5% in 2016, compared with a previous forecast of 1.2% expansion, Visco said. (Bloomberg)

Currencies

· Dollar Index Soars Friday, But Ends Week Lower. The ICE U.S. Dollar Index ended the week lower Friday as the gains that followed January payrolls data failed to offset the euro’s strength from earlier in the week. The dollar soared to ¥119.17 after the report, its highest level against the Japanese currency in a month. It traded at ¥117.54 late Thursday in New York. The euro traded at $1.1315 after surrendering all of its massive gains from Thursday’s session. The shared currency traded at $1.1467 Thursday evening. Meanwhile, the pound traded at $1.5248, compared with $1.5322 Thursday. The dollar index, a measure of the dollar’s strength against a trade-weighted basket of six rival currencies, was up 1% to 94.6980, its highest level in a week. (Market Watch)

Commodities

· Brent Posts Best Two Weeks Since 1998. Oil rallied again on Friday, with benchmark Brent crude having its largest twoweek gain in 17 years, as falling oil rig counts and violence in producer Libya helped further stall a selloff that began in June. Crude prices have risen nearly 20% over the past six sessions, but remain about 50% below their peak from the middle of last year due to worries of a global oil glut. Brent futures posted a 9% gain on the week, their biggest since 2011, and 19% over two weeks, the largest since 1998. Brent settled up $1.23, or 2.2%, on the day at $57.80 a barrel. U.S. crude closed up $1.21, or 2.4%, at $51.69. (Reuters) · Gold, Knocked Lower By Strong U.S. Jobs Data, Gold fell more than 2% on Friday as global stock markets and the dollar rose on stronger-than-expected U.S. jobs data, raising expectations that the Federal Reserve will increase interest rates by midyear. Spot gold dropped to a three-week low of $1,228.25 an ounce earlier and was down 2.4% at $1,234.70 an ounce by 2:02 p.m. EST (1902 GMT), its biggest fall since Dec. 15. It has lost 3.8% so far this week, which would be its largest fall since the week ended Oct. 31. Spot silver slid 3.7% to $16.62 an ounce. Platinum was down 2.6% at $1,218.50 an ounce and palladium dropped 1.7% to $779.00 an ounce. (Reuters)