Global

Puerto Rico on the Brink Owes Investors $5 Billion in Next Year. Puerto Rico faces $5.4 billion of bond payments over the next 12 months, showing the pressure on the Caribbean island as it moves closer toward defaulting on its debt. Puerto Rico and its agencies are on the hook for $635 million in August, the largest monthly bill for the rest of 2015. Governor Alejandro Garcia Padilla is pushing to restructure a $72 billion debt load he says the island can’t afford. (Bloomberg)

Asia

Singapore Headline Inflation Likely to Be Negative Rest of Year. Singapore’s central bank said consumer price declines aren’t persistent or pervasive, even as the country’s headline inflation is likely to be negative for the rest of the year. The Monetary Authority of Singapore maintained its prediction of a 0.5% drop to 0.5% gain in consumer prices this year. The nation’s growth will probably be moderate and uneven amid China’s slowdown and firm business costs. Consumer prices fell for a seventh straight month in May. (Bloomberg)

China Heralds Boost for Emerging Nations with BRICS Bank Opening. The biggest emerging economies opened their New Development Bank in Shanghai, strengthening China’s ability to offer developing nations the support traditionally given by the U.S. and Japan through organizations like the World Bank. BRICS Bank as it is known after sponsors Brazil, Russia, India, China and South Africa -- will help with the recovery and development of emerging economies. The NDB will have initial capital of $50 billion with plans to raise that to $100 billion over time. (Bloomberg)

China FDI Increases Only Marginally Year on Year in June. The amount of foreign direct investment (FDI) China drew in June was only 0.7% more than the year-earlier total, underlining how a slowing economy continues to dent investor confidence. China attracted $14.6 billion in FDI in June. In the first six months, China drew $68.4 billion in FDI, up 8.3% from a year earlier. China's fast-growing services sector attracted $43.4 billion of FDI in the first half of this year, up 23.6% from a year ago. FDI in manufacturing dropped 8.4% from a year earlier to $20.9 billion. (Reuters)

China Outbound Investment Expands as Nation Boosts Global Clout. China’s long-term outbound investment is catching up with inbound foreign investment, bringing the country closer to becoming a net exporter of funds. Outbound investment in yuan terms jumped 29.2% in the first half from a year earlier, dwarfing the 8.3% gain in foreign direct investment inflows. Total outward investment was 343.2 billion yuan ($55 billion) during the period, compared with 420.5 billion yuan in FDI. (Bloomberg)

China Injects Massive Funds Into Policy Lenders. The People's Bank of China will inject $45 billion into the Export-Import Bank of China (EXIM) and the finance ministry will inject 100 billion yuan ($16 billion) into the Agricultural Development Bank of China (ADBC), Caxin, a respected domestic financial magazine, reported. Beijing is stepping up reforms at its policy lenders to drive economic growth and boost Chinese companies' global competitiveness. (Reuters)

South Korea Q2 GDP Growth to Be "Much Lower" Than Q1. South Korea's finance minister said second-quarter growth is expected to be "much lower" than growth seen in the first quarter of this year. The global economic slowdown and lower oil prices have negatively affected Korea's export performance. Preliminary second-quarter GDP data will be released by the Bank of Korea on July 23. (Reuters)

BOJ's Kuroda: Japan's Inflation to Accelerate 'Considerably,' Sees No Need for More QE. Bank of Japan Governor Haruhiko Kuroda said he expected inflation to accelerate considerably in the coming months due to a tight labor market, and he brushed off the idea of needing more quantitative easing. He said consumer prices are still on track to meet the central bank's 2% inflation target sometime around the first half of fiscal 2016. Kuroda's optimism is in contrast with growing worries that turbulence in the global economy could cause oil prices to resume their decline and place more downward pressure on Japan's consumer prices. (Reuters)

RBA Says Growth Likely Slowed Last Quarter, Aussie Too High. Australia’s central bank said growth probably slowed last quarter and the currency is offering less assistance than would be expected given weaker commodity prices. The RBA lowered borrowing costs twice this year as it sought to accelerate a transition toward service industries and manufacturing as a decade-long mining boom winds down. The central bank would prefer a weaker currency to boost the competitiveness of local industries. (Bloomberg)

Economic Risks for Vietnam's Banks Very High. Economic risks for Vietnam's banking sector are very high by global standards, according to Standard & Poor's Ratings Services. The risks were reflected in the country's low income levels, developing financial system, and evolving policy framework. It said banks' credit risks remain extremely high, reflecting high private sector debt, low income levels, legacy stressed assets, and rudimentary underwriting standards. S&P said Vietnam's banking regulations lagged international standards. S&P regarded Vietnam's economic risk trend as stable as its economic growth has picked up. (The Star)

USA

Fed's Bullard Says Better Than 50% Chance of Fed Hike in September. There is a better than 50% chance that the Federal Reserve will raise interest rates in September. St. Louis Fed President James Bullard said the Fed should get ahead of the curve, as inflation will rise and labor market slack will end. (Reuters)

Unemployment Rates Fell in 21 US States in June, Rose in 12. Unemployment rates fell last month in 21 U.S. states and were unchanged in 17, as widespread job growth and a shrinking workforce reduce the ranks of those out of work. There is also evidence that the falling unemployment rates in many states could be boosting wage growth, according to an analyst note, a trend that could emerge at the national level. The Labor Department said Tuesday that unemployment rates rose in 12 states. (AP)

Europe

S&P Raises Greece Rating By Two Notches on Bailout Talks with Creditors. Standard & Poor's on Tuesday upgraded Greece's sovereign credit rating by two notches and revised its outlook to stable from negative. S&P raised its rating for Greece to CCC+ from CCC-, saying the country's liquidity perspective has improved after euro zone gave their initial consent to a three-year loan program to keep the country in the euro. The possibly Greece quit the single currency union was lest than 50%, it said. (Reuters)

Greek Business Warn of Closures as Capital Controls Choke Supplies. Greece risks seeing a wave of companies forced out of business within weeks because of restrictions on foreign transfers that have persisted even after banks reopened this week, the head of the Athens Chamber of Commerce warned on Tuesday. Constantinos Michalos said that if capital controls were still in place by mid-August, companies would start going out of business. (Reuters)

Osborne to Seek 20 Billion Pounds of U.K. Government Cuts. Chancellor of the Exchequer George Osborne will announce Tuesday that he’s seeking a further 20 billion pounds ($31 billion) of savings from U.K. government departments ahead of a spending review. Osborne said national debt remains at its highest level for 50 years. Osborne will also announce that the Bank of England will be opened to scrutiny from the National Audit Office as part of plans to improve the central bank’s governance and accountability. (Bloomberg)

U.K. Has Smallest June Budget Deficit Since 2008 on Taxes. Britain posted the smallest budget deficit for any June since 2008 as tax revenues from personal incomes and corporate profits surged. Net borrowing excluding public-sector banks was 9.4 billion pounds ($14.6 billion) compared with 10.2 billion pounds a year earlier. Government income rose 4.4% and spending increased 2.9%. (Bloomberg)

Currencies

Euro Rebounds from 3-month Low, Yen Gains on Kuroda Remarks. The euro on Tuesday rebounded from three-month lows against the dollar as an easing of pessimism about Greece had traders paring bearish bets, while the yen rose versus the greenback on upbeat remarks on inflation from the Bank of Japan chief. The euro was up 1.1% at $1.0940 in late U.S. trading after retesting a near three-month low of $1.0808 set on Monday. It is down 1.7% so far this month. The dollar weakened 0.3% to 123.95 yen, swinging from a five-week high of 124.48 in the Asian session. Strength in the euro and yen pushed down the dollar index, which fell 0.7% to 97.321 after touching a 3-month peak at 98.151 earlier Tuesday. (Reuters)

Ringgit extends gains against US dollar. The ringgit closed higher against the US dollar again on Tuesday on the back of persistent interest for the local unit amid the stronger greenback. At 5 pm (June 21), the ringgit was quoted at 3.8020/8050 against the greenback from 3.8050/8080 Monday. "There are lack of local catalysts to move the ringgit. However, due to its recent depreciation, the ringgit managed to attract some bargain hunters to lift its value slightly," a dealer said. The ringgit was traded mostly higher against other major currencies. It rose against the yen to 3.0580/0611 from 3.0616/0643 on Monday; appreciated against the pound sterling to 5.9212/9263 from yesterday's 5.9244/9306; and, strengthened against the euro to 4.1267/1315 from 4.1280/1321 on Monday. However, the ringgit eased against the Singapore dollar to 2.7786/7812 from 2.7733/7757 previously. (Bernama)

Commodities

Oil Gains after Choppy Trade, U.S. August Crude Expires above $50. Crude oil futures held on to gains after a volatile session that saw the U.S. front-month August contract expire and go off the board above $50 a barrel, with a weaker dollar providing support. Expiring U.S. August crude rose 21 cents to settle at $50.36 a barrel, after slipping to $49.77 intraday. U.S. September crude settled at $50.86, up 42 cents. Brent September crude rose 39 cents to settle at $57.04, having swung from $56.33 to $57.44. Brent's premium to September U.S. crude remained above $6 a barrel. (Reuters)

Gold Teeters Near 5-year Low, Braced for More Losses. Gold edged higher on Tuesday, the day after it took its deepest dive in years and hit five-year lows, with many dealers bracing for more losses on expectations for a rise in U.S. interest rates and subdued demand from India. Spot gold was up 0.2% at $1,098.58 per ounce at 3:00 p.m. EDT (1900 GMT), but traders remained uneasy due to another day of unusually large trading volumes in China, where many suspect the selling spree originated. Among other precious metals, platinum was up 0.5%. Palladium was last up 1.7% at $614.75. Spot silver was up 1.2% at $14.80 an ounce. (Reuters)