Global

· Once Over $12 Trillion, the World’s Reserves Are Now Shrinking. The decade-long surge in foreign-currency reserves held by the world’s central banks is coming to an end. Global reserves declined to $11.6 trillion in March from a record $12.03 trillion in August 2014, halting a five-fold increase that began in 2004. While the drop may be overstated because the strengthening dollar reduced the value of other reserve currencies such as the euro, it still underlines a shift after central banks—with most of them located in developing nations like China and Russia—added an average $824 billion to reserves each year over the past decade. Beyond being emblematic of the dollar’s return to its role as the world’s undisputed dominant currency, the drop in reserves has several potential implications for global markets. It could make it harder for emerging-market countries to boost their money supply and shore up faltering economic growth; it could add to declines in the euro; and it could damp demand for U.S. Treasury bonds. (Bloomberg)

Malaysia

· Exports Fall 9.7% on LowOil & Gas Prices and Seasonality. Exports fell sharply in February, down 9.7% YoY and overshooting consensus estimates that called for a much smaller 1.4% decrease. The slide in exports along with almost no change to the value of imports on a YoY basis (0.4%), caused the trade balance to fall to RM4.5b, about half that of January and well below estimates in market polls. The value of total trade during February was RM101.8b, about 13.9% lower than the previous month because of the seasonal effect of the Lunar New Year during the month. Commodity receipts continued its weak streak because of broadly lower prices for crude oil, refined petroleum and palm oil in international markets. (Please refer to Economic Viewpoint)

Asia

· Japan Bonuses up, Real Wage Decline Slows in Positive Sign for Abenomics. Japanese wage earners' total cash earnings rose for a third straight month in February and winter bonuses grew for the first time in six years in 2014, government data showed, a positive sign for Tokyo's efforts to end nearly two decades of deflation. However, inflationadjusted real wages fell 2.0% in February from a year earlier, down for a 22nd straight month and hurting household purchasing power. The rate of decline narrowed from January's 2.3% fall, the labour ministry data showed. Prime Minister Shinzo Abe is pressuring Japanese firms to raise wages, a step seen as essential to generating a virtuous growth cycle of higher wages and consumer spending leading to higher corporate profits, investment and employment. The labour ministry data showed wage earners' total cash earnings rose 0.5% to 261,344 yen ($2,184) in February from a year earlier, up three months in a row, helped by a tight job market. Year-end bonuses paid between November and January rose 1.9% to 375,431 yen from a year earlier, the first gain in six years. That marked the biggest increase in a decade. (Reuters)

· India’s Trade Deficit with China to Double in the Next Two Years. India's trade deficit with China could nearly double to $60 billion in the next two years if the two partners do not address market access constraints and nontariff barriers faced by Indian goods in the neighbouring country, the department of commerce cautioned in the foreign trade policy statement released last week ahead of Prime Minister Narendra Modi's expected visit to Beijing in the second week of May. India is pushing for tariff concessions from China in oil seeds, textile items and marine products in the fourth round of tariff concessions under Asia-Pacific Trade Agreement (APTA) in a bid to correct the imbalance in bilateral trade. The trade deficit widened to $36 billion in 2013-14, accounting for a quarter of India's overall export and import gap. "If the current situation persists, by 2016-17, merchandise imports from China will exceed $80 billion while India's exports will be around $20 billion, leaving an unsustainable trade deficit of $60 billion," the commerce department said. (The Economic Times)

· China’s Services Sector Expands in March, Job Growth at 10-Month Low. China's services sector expanded in March even as growth in employment and new business fell to their lowest in at least eight months, a private survey showed on Friday. The HSBC/Markit China Services Purchasing Managers' Index (PMI) inched higher to 52.3 in March, compared with February's 52.0, and above the 50-point level that separates growth from a contraction in activity on a monthly basis. But the marginal expansion was offset by lacklustre growth in employment, which fell to a 10-month trough of 51.1. Growth in new businesses was at an eight-month low. "Chinese manufacturers and service providers both managed only modest increases in output at the end of the first quarter," said Annabel Fiddes, economist at Markit, adding that data "suggests that relatively weak client demand had dampened growth across both sectors". (Reuters)

· China’s Pension Funds Likely to Have Funding Gap. China's state pension funds will likely have a funding gap in future due to growing obligations, Vice Finance Minister Wang Baoan said on Friday. China has struggled to keep its pension schemes adequately funded, with local governments and companies sometimes avoiding contributions. Analysts have long warned about China's state pension crisis and the severe funding shortage, with some estimating that the cash shortfall could rise to as high as nearly $11 trillion in the next 20 years. "The idea that our pension funds will have a funding gap, I think that is possible," Wang told a press briefing on Friday. In a move to relieve some of the financing pressures on the funds, China decided to expand the investment scope of its national social security fund this week to allow it to buy more investment trusts, as well as corporate and local government debt, he said. (Reuters)

· China’s Big-city Minimum Wages Up in 2015. Urban minimum wages continue to climb, even as the economy weakens, amid a campaign against income disparities. Workers in Shenzhen will take home at least 2,030 yuan ($327) a month this year, the most among large cities and up 12.3%. Shanghai came in second at 2,020 yuan, up 11%. Third-ranked Guangzhou logged the biggest gain of 22.3% to 1,895 yuan. Tianjin followed with a 10.1% rise to 1,850 yuan, while Beijing rounded out the top five at 1,720 yuan, up 10.3%. In fact, minimum wages in metropolitan areas have roughly doubled over the past five years. The gains come at a time when the ruling Communist Party seeks to show migrant workers and other low-income earners that it serious about addressing widening income inequality. (Nikkei)

USA

· Hiring Boom Fizzles as Companies Adjust to Slower U.S. Growth. America’s employment boom fizzled in March. Payrolls increased by 126,000 workers last month, the smallest gain since December 2013 and weaker than the most pessimistic forecast in a Bloomberg survey, a report from the Labor Department in Washington showed Friday. The advance over the prior 12 months averaged 269,000. The jobs data are now more in line with recent figures showing economic growth cooled in the first quarter as energy companies pulled back, the strong dollar and tepid overseas markets hurt manufacturers and rough winter weather restrained consumer spending. Even with the moderation, employment opportunities are keeping Americans upbeat, laying the ground for a rebound in spending. The unemployment rate held at 5.5%, the lowest level since May 2008, and worker earnings improved, the report also showed. Hourly pay was a silver lining, rising by 0.3% from the prior month and 2.1% from a year earlier and in line with the average since the expansion began in June 2009. (Bloomberg)

· US Hiring Slowdown Hit Most Industry Sectors In March. The deceleration of hiring last month hit nearly all parts of the job market as U.S. employers grew wary about the health of the economy.The construction, manufacturing and government sectors all lost workers. Manufacturers cut 1,000 after a 19-month hiring streak. Construction jobs also fell by 1,000, the first decline in 15 months.Other sectors posted slowdowns. The category that includes hotels and restaurants added just 17,000 workers after having hired 70,000 in February. The education and health sector gained 38,000, down from 57,000 in February.A few categories managed to maintain momentum. Professional and business services added 40,000. Employers in transportation and warehousing gained 9,500, nearly matching February's figure.Overall, U.S. employers added 126,000 jobs in March, the weakest showing since December 2013. (AP)

Europe

· Hollande Reveals Measures to Kick-Start Investment. François Hollande has sought to mollify critics within his ruling Socialist party without reneging on his pro-business stance with measures aimed at boosting investment. The move comes days after the French president’s party suffered a setback in local elections, which prompted socialist rebels to demand a change to the pro-business policies the government has introduced in the past year. Mr Hollande on Friday promised tax incentives for companies buying capital equipment, while state-backed bank BPI would increase loans to small and medium-sized businesses from €5bn to €8bn. Private insurers also committed to a €500m fund that would buy equity stakes in companies looking to raise money. “We’re not carrying out reforms for companies; we are supporting companies so that they invest,” Mr Hollande said, addressing workers at a factory in Trie-Château, north of Paris. (Financial Times)

Currencies

· Big Miss on U.S. jobs Data Drives Dollar Down. The dollar tumbled on Friday after a significantly weaker-than-expected U.S. jobs report that will increase speculation over whether the U.S. Federal Reserve holds off tightening monetary policy for longer than expected. The euro shot up over 1% after the report to a one week high of $1.10270 before drifting to $1.09750, a gain of 0.88% on the EBS trading platform. The dollar fell against its major trading partners' currencies. The dollar index traded down 0.71% to 96.736 .Against the Japanese yen, the dollar hit a one-week low of 118.71 yen before settling around 119, off 0.58% on the day. The greenback dropped to five-week nadir of 0.94860 Swiss franc. (Reuters)

Commodities

· Oil Slides after Agreement with Iran. Iran’s agreement on Thursday with world powers over its nuclear activities brings the Opec member closer to achieving its goal of restoring oil production and exports, but the timeframe remained unclear. Diplomats aim to reach a final deal by June 30. Under the accord the US and EU would lift economic sanctions if the International Atomic Energy Agency can confirm Iran has taken the necessary steps to curb its nuclear advances. The prospect of a wave of Iranian crude exports being released into an already oversupplied market in the months following a comprehensive deal sent the price of internationally traded Brent crude lower by 3.8% to $54.95 a barrel. (Financial Times)

· Gold Firms after U.S. Payrolls Data Misses Forecast. Gold prices firmed on Friday in holiday-thinned trading, after data showing U.S. employers added the fewest jobs in over a year in March fueled speculation that a U.S. interest rate hike may be delayed. Spot gold was up 0.7% at $1,210.20 an ounce by 3:10 p.m. EST (1910 GMT), after easing 0.2% on Thursday. "Investors are dialing back on the rate hike expectations," Naeem Aslam, chief market analyst at Ava Trade, said. "This translates as good news for gold, but bad news for the dollar." Trading was expected to be lean for most markets, including those in the United States and Europe, shut for the Good Friday holiday. Among other precious metals, platinum was up 0.5% at $1,155 an ounce, while palladium was down 0.5% at $740.65 an ounce. Silver was up 1.7% at $17 an ounce.