• Malaysia Seeks Substantial Conclusion of RCEP Negotiations. Malaysia, the ASEAN chairman this year, is looking at a substantial conclusion of the Regional Comprehensive Economic Partnership (RCEP) negotiations this year. International Trade and Industry Ministry Secretary-General Tan Sri Dr Rebecca Fatima Sta Maria said a comprehensive closed door meeting, that will gather all 16 countries involved in the RCEP, would be held this Monday. Started in May 2013, the RCEP is being negotiated between the 10 ASEAN countries and their six free trade agreement partners, namely Australia, China, India, Japan, New Zealand and South Korea. (Bernama) 
• May Industrial Production Better Estimates, up 4.5% YoY. Industrial production performed better than expected in May, with the Industrial Production Index (IPI) increasing 4.5% YoY and 3.8% MoM from a dip in April. The consensus estimate was anticipating a smaller YoY increase of 3.1% while the house estimate was a more pessimistic 2.9%. Despite May data exceeding estimates, industrial production growth remained on a moderating trend with its three-month moving average growing at just 5.2% YoY (April: 5.4%). Manufacturing output, which alone accounts for about two-thirds of the IPI, was up 3.2% YoY, higher than our estimate of 2.9%. (See Economic Viewpoint)

• India’s Factory Output Misses Estimates as Consumer Goods Fall. India’s factory output rose less than economists estimated, boosting pressure on policy makers to revive investment in Asia’s third-largest economy. Industrial production rose 2.7% in May from a year earlier after a revised 3.4% gain in April, the Central Statistical Office said in a statement on Friday. That compares with a 4% rise predicted by the median of 32 estimates in a survey of economists. Manufacturing output climbed 2.2%, electricity 6%, mining 2.8% and capital goods production rose 1.8%. Consumer goods fell 1.6%. (Bloomberg) 
• Thai Planning Agency to Cut 2015 GDP, Export Forecasts. Thailand's state planning agency will lower its 2015 economic growth forecast of 3.0% - 4.0% seen in May as exports are now expected to contract for the third year this year. The economy would probably grow around 3% this year and it's "possible" that exports will contract 1-2% rather than rise 0.2% as seen earlier, Porametee Vimolsiri, deputy secretary general of the National Economic and Social Development Board (NESDB) said. (Reuters) 
• China Will Increase Targeted Policy Adjustments. China will make more targeted changes to its policies to support the Chinese economy, Premier Li Keqiang said on Friday. At a meeting of government officials to discuss cooling Chinese economic activity, Li said China still needed to strengthen the growth foundation of its economy, given the complexities of the foreign and domestic environment. He did not elaborate on how the government would adjust its policies, saying only that there would be some pre-emptive "fine-tuning". China's central bank has in the past lowered interest rates or reduced the amount of reserves that banks must hold following government promises to "fine-tune" policies. (Reuters)

• US Wholesale Stockpiles Post Biggest Gain in 6 Months in May. U.S. wholesalers boosted their stockpiles in May by the largest amount in six months, while sales rose by a modest amount. Wholesale stockpiles rose 0.8%, double the gain in April and the largest one-month rise since November, the Commerce Department reported Friday. Sales were up 0.3% in May following a 1.7% surge in April. That had been the biggest sales increase in more than a year. The strong increase in inventory building in May could be evidence that businesses are growing more confident about the future. A decision to accelerate inventory stocking would help bolster overall economic growth. (AP)
• Canada Jobs Loss in June Ratifies Faltering Economy View. Canadian employment fell by 6,400 in June on the biggest decline in part-time work in more than four years, sustaining the view the economy is losing steam and may require another jolt of stimulus from the central bank. The unemployment rate remained at 6.8% for a fifth month, Statistics Canada said Friday in Ottawa. Part-time work fell 71,200, exceeding the 64,800 gain in full-time work. Quebec posted a decline of 33,300, the most since May 2005. Private companies cut 26,300 workers, tempering gains in public-sector employment, which rose by 42,200. (Reuters)

• Greece Talks Deadlocked as Euro Hardliners Resist New Bailout. European finance aides worked through the night struggling to overcome a deadlock over how to keep Greece in the euro after an impasse among their bosses forced a second day of emergency talks. A hardline group led by Germany resisted the appeal, threatening to delay the infusion Greek Prime Minister Alexis Tsipras desperately needs as Greece runs low on cash and its banks head into a third week of being shut. The issues involve dealing with its growing debt and the credibility of reforms that some ministers said rely too heavily on taxes. The standoff in Brussels came hours after Tsipras won overwhelming support in the Greek Parliament for a package of spending cuts, pension savings and tax increases intended to win financial aid of at least 74 billion euros ($83 billion). (Bloomberg) 
• French Industrial Output Rebounds in May. French industrial production rebounded in May after a sharp drop in April and zero growth in March, data showed Friday. Industrial production in the eurozone's second largest economy rose 0.4% in May from April, when it fell 0.8%, French statistics agency Insee said. The May figure is in line with the average forecast of economists polled by the. The rise in industrial output was supported by a 2.3% jump in output in the transport and automobile sector. Output for the entire manufacturing sector rose 0.6%.(Wall Street Journal) .
• UK Overhauls Home-Building Rules in Bid to Boost Productivity. Britain's government said on Friday it would remove obstacles to building new houses as it tries to tackle a chronic shortage of homes and put its economy on a sounder footing. At the centre of a new programme to boost Britain's poor productivity record are powers for the government to step in and draw up housing plans if local authorities fail to do so. Town halls that drag their feet on planning decisions may be fined, the government said as it moved to reduce the delays for housing projects that are often caused by local objections. (Reuters)

Source: Kenanga Research - 13 Jul 2015