Asia Pacific

· Singapore February Factory Activity Shrinks, Electronics Suffer First Contraction in Over 2 Years. Activity in Singapore's manufacturing sector contracted for the third straight month in February as new orders declined, with the key electronics index shrinking for the first time in more than two years, a survey showed on Tuesday. The Singapore Institute of Purchasing & Materials Management's Purchasing Managers' index (PMI) fell to 49.7 in February from January's 49.9. The index has been below 50 since December. That level separates contraction from expansion on a monthly basis. "The contraction in the overall PMI was attributed to further decline in new orders," the institute said in a statement, adding new export orders and production output both reversed direction and contracted. The PMI for the electronics sector fell to 49.8 in February from 50.5 in January, according to the institute. It was the first contraction for the sector since January 2013. (Reuters)

· Japan Wages Rise 1.3% Year-On-Year in January. Japanese wage earners' total cash earnings in January grew 1.3% from a year earlier and declines in real wages slowed for a third month, government data showed on Tuesday, a positive sign for Prime Minister Shinzo Abe's plan to revive the economy. Real wages, which are adjusted for inflation, fell 1.5% year-on-year in January, slower than a 1.7% annual decline in December. Abe has publicly called on companies to raise base pay for labour union workers during spring negotiations, which is vital to his aim of generating a virtuous cycle of higher wages and consumption to reflate the economy and break a two-decade cycle of tepid growth and deflation. (Reuters)

· Reserve Bank of Australia Signals Further Easing After Unexpectedly Standing Pat. The RBA said further interestrate cuts could be needed to bolster growth after it unexpectedly left its benchmark unchanged. The currency gained. “Further easing of policy may be appropriate over the period ahead, in order to foster sustainable growth in demand and inflation consistent with the target,” Governor Glenn Stevens said in a statement Tuesday after leaving the overnight cash rate at 2.25%. The decision was predicted by 11 of 29 economists surveyed, while 18 saw a cut. The currency “remains above most estimates of its fundamental value, particularly given the significant declines in key commodity prices,” Stevens said. (Bloomberg)

· Taiwan January Export Orders Grow Less Than Expected, But Momentum Seen Solid. Taiwan's export orders at the start of the year fell short of expectations as the off-peak season softened overall demand, but no dents were seen in the island's solid tech export engine. Orders, a leading indicator for the island's exports and a global gauge for technology goods demand, showed sustained momentum from last year, during which they rose to a record annual amount driven by demand for smartphones, laptops and other technology gadgets. Taiwan's export orders in January rose 8.1% from a year earlier to $39 billion, but were down from December's $44.2 billion, data from the Ministry of Economic Affairs showed. The growth, while underperforming expectations of a 9.65% year-on-year gain, came on strong demand from key markets in the United States and Europe. U.S. orders climbed 24.7% from a year earlier, while those from Europe rose nearly 17%. Orders from China were up 3.9% but those from Japan tumbled 22.6%. (Reuters)

· Korea inflation hits 16-year low as oil drags, rate cut seen. South Korea's annual inflation in February slowest to a 16- year low on Tuesday as the recent collapse in global oil pressured consumer prices, backing expectations for another rate cut to ward off deflation in Asia's fourth-largest economy. The consumer price index rose 0.5% in February year-on-year, cooling from 0.8% in January, Statistics Korea data showed. It was lower than the median forecast of 0.8% in a survey and marked the smallest increase since July 1999. A majority of economists are predicting a rate cut either at the March 12 review, or in April to boost economic activity. (Reuters)

North America

· Sluggish February U.S. Car Sales Blamed on Blustery Weather. For the second year in a row, ferocious winter weather slowed U.S. vehicle sales in February, causing the major automakers to miss analysts' bullish projections. Six of the top seven manufacturers on Tuesday reported year-to-year sales increases, but all fell short of expectations. Total U.S. sales in February rose 5.3% to 1,257,619 vehicles, according to research firm Autodata. Analysts surveyed had expected an increase of 7.1%. The industry finished with an annualized sales rate in February of 16.23 million vehicles, far below the 16.7 million that economists had expected. Most companies blamed extreme weather conditions in the U.S. Northeast and Midwest. (Reuters)

· U.S. CEOs Modestly More Upbeat On Economy, Spending: Survey. U.S. chief executive officers are modestly more upbeat about the economy and almost half plan to increase capital spending over the next six months, a quarterly business group survey said on Tuesday. CEOs expect U.S. gross domestic product to rise by 2.8% this year, compared to a projection of a 2.4% increase a quarter earlier, according to the first-quarter survey by the Business Roundtable. Of the 120 CEOs who responded to the survey, 45% expect to boost U.S. capital spending in the next six months, up from 36% in the fourth-quarter survey. Forty% expect to increase U.S. employment, about the same level as in the prior survey. (Reuters)

· Canada Quarterly GDP Growth Exceeds Forecasts. Canada’s economy grew faster than expected in the fourth quarter, as consumers boosted spending and businesses built up stockpiles of unsold goods. Gross domestic product rose at a 2.4% annualized pace from October to December, Statistics Canada said Tuesday in Ottawa. The agency also raised third

Asia Pacific

· Singapore February Factory Activity Shrinks, Electronics Suffer First Contraction in Over 2 Years. Activity in Singapore's manufacturing sector contracted for the third straight month in February as new orders declined, with the key electronics index shrinking for the first time in more than two years, a survey showed on Tuesday. The Singapore Institute of Purchasing & Materials Management's Purchasing Managers' index (PMI) fell to 49.7 in February from January's 49.9. The index has been below 50 since December. That level separates contraction from expansion on a monthly basis. "The contraction in the overall PMI was attributed to further decline in new orders," the institute said in a statement, adding new export orders and production output both reversed direction and contracted. The PMI for the electronics sector fell to 49.8 in February from 50.5 in January, according to the institute. It was the first contraction for the sector since January 2013. (Reuters)

· Japan Wages Rise 1.3% Year-On-Year in January. Japanese wage earners' total cash earnings in January grew 1.3% from a year earlier and declines in real wages slowed for a third month, government data showed on Tuesday, a positive sign for Prime Minister Shinzo Abe's plan to revive the economy. Real wages, which are adjusted for inflation, fell 1.5% year-on-year in January, slower than a 1.7% annual decline in December. Abe has publicly called on companies to raise base pay for labour union workers during spring negotiations, which is vital to his aim of generating a virtuous cycle of higher wages and consumption to reflate the economy and break a two-decade cycle of tepid growth and deflation. (Reuters)

· Reserve Bank of Australia Signals Further Easing After Unexpectedly Standing Pat. The RBA said further interestrate cuts could be needed to bolster growth after it unexpectedly left its benchmark unchanged. The currency gained. “Further easing of policy may be appropriate over the period ahead, in order to foster sustainable growth in demand and inflation consistent with the target,” Governor Glenn Stevens said in a statement Tuesday after leaving the overnight cash rate at 2.25%. The decision was predicted by 11 of 29 economists surveyed, while 18 saw a cut. The currency “remains above most estimates of its fundamental value, particularly given the significant declines in key commodity prices,” Stevens said. (Bloomberg) · Taiwan January Export Orders Grow Less Than Expected, But Momentum Seen Solid. Taiwan's export orders at the start of the year fell short of expectations as the off-peak season softened overall demand, but no dents were seen in the island's solid tech export engine. Orders, a leading indicator for the island's exports and a global gauge for technology goods demand, showed sustained momentum from last year, during which they rose to a record annual amount driven by demand for smartphones, laptops and other technology gadgets. Taiwan's export orders in January rose 8.1% from a year earlier to $39 billion, but were down from December's $44.2 billion, data from the Ministry of Economic Affairs showed. The growth, while underperforming expectations of a 9.65% year-on-year gain, came on strong demand from key markets in the United States and Europe. U.S. orders climbed 24.7% from a year earlier, while those from Europe rose nearly 17%. Orders from China were up 3.9% but those from Japan tumbled 22.6%. (Reuters)

· Korea inflation hits 16-year low as oil drags, rate cut seen. South Korea's annual inflation in February slowest to a 16- year low on Tuesday as the recent collapse in global oil pressured consumer prices, backing expectations for another rate cut to ward off deflation in Asia's fourth-largest economy. The consumer price index rose 0.5% in February year-on-year, cooling from 0.8% in January, Statistics Korea data showed. It was lower than the median forecast of 0.8% in a survey and marked the smallest increase since July 1999. A majority of economists are predicting a rate cut either at the March 12 review, or in April to boost economic activity. (Reuters)

North America

· Sluggish February U.S. Car Sales Blamed on Blustery Weather. For the second year in a row, ferocious winter weather slowed U.S. vehicle sales in February, causing the major automakers to miss analysts' bullish projections. Six of the top seven manufacturers on Tuesday reported year-to-year sales increases, but all fell short of expectations. Total U.S. sales in February rose 5.3% to 1,257,619 vehicles, according to research firm Autodata. Analysts surveyed had expected an increase of 7.1%. The industry finished with an annualized sales rate in February of 16.23 million vehicles, far below the 16.7 million that economists had expected. Most companies blamed extreme weather conditions in the U.S. Northeast and Midwest. (Reuters)

· U.S. CEOs Modestly More Upbeat On Economy, Spending: Survey. U.S. chief executive officers are modestly more upbeat about the economy and almost half plan to increase capital spending over the next six months, a quarterly business group survey said on Tuesday. CEOs expect U.S. gross domestic product to rise by 2.8% this year, compared to a projection of a 2.4% increase a quarter earlier, according to the first-quarter survey by the Business Roundtable. Of the 120 CEOs who responded to the survey, 45% expect to boost U.S. capital spending in the next six months, up from 36% in the fourth-quarter survey. Forty% expect to increase U.S. employment, about the same level as in the prior survey. (Reuters)

· Canada Quarterly GDP Growth Exceeds Forecasts. Canada’s economy grew faster than expected in the fourth quarter, as consumers boosted spending and businesses built up stockpiles of unsold goods. Gross domestic product rose at a 2.4% annualized pace from October to December, Statistics Canada said Tuesday in Ottawa. The agency also raised third