China's next Economic Indicators

China's GDP growth is estimated at 7.5 percent in the second quarter, from 7.7 percent for the January-March period, according to analysts' forecasts.

An economic slowdown may prompt the government to roll out more reforms after the Chinese economy last year expanded at the slowest pace since the Asian financial crisis in 1997.

"We maintain our Q2 GDP growth forecast of 7.5 percent, which is lower than the 7.7 percent in Q1," said Barclays China economist Chang Jian on Monday.

Chang said the manufacturing PMIs confirmed a further slowdown in industrial activities. She forecast year-on-year industrial production growth to drop to 9 percent in June.

HSBC PMI readings indicated manufacturing, which accounts for 40 percent of China's GDP, contracted in May and June.

China International Capital Corporation Ltd said in an earlier report that the economic growth rate for the second quarter will be 7.5 percent due to weak investment, exports and overall demand.

China plans to release June inflation figures on Tuesday and trade numbers on Wednesday, while GDP growth in the second quarter is due on July 15.

China has targeted 7.5 percent economic growth and 3.5 percent inflation this year.

Its economic growth eased to a 13-year low of 7.8 percent in 2012. The government cooled the inflation rate to 2.6 percent year on year in 2012 from 5.4 percent in 2011.

Source: Xinhua

China:Japanese to stop hurting feelings of Countries that where invaded during World War II

  Prime Minister Shinzo Abe should face up to history and stop hurting the feelings of people in countries that Japan invaded in World War II, a Chinese Foreign Ministry spokeswoman urged on Monday.

Hua Chunying made the comments at a daily news briefing in response to a question regarding Abe's words on history.

"Every country has pride in its history so what is important is to have mutual respect," Abe told a television show on Sunday.

"We are shocked at what the Japanese leader has said," Hua said, adding that it was 76 years ago to the day (July 7, 1937) that Japan launched an all-out war against China, known as the Lugouqiao Incident.

It is undeniable that Japan's invasion into and colonial ruling of its neighboring countries in Asia imposed great pain and disaster on the people there, Hua said.

What Japan should do is not "take pride in" but look up to and carry out self-questioning about the history of the invasion, she said, adding that the Japanese side should stop using history as a tool to hurt the feelings of Asian people.

Source: Xinhua

Japan with a Current Account Surplus

Japan had a current account surplus for the fourth consecutive month in May, as growth in direct investment income outweighed a trade deficit triggered by a rise in fossil fuel imports, government data showed Monday.

Source:  NewsonJapan

Lending Pick Up in Japan

Japanese bank lending marked its biggest annual increase in four years in June, suggesting the central bank's aggressive monetary stimulus and brightening economic prospects are spurring fund demand for fresh investment.

Source: NewsonJapan

Eike Batista Cansado de Guerra

"A renúncia de Eike Batista da presidência e do conselho de administração da MPX, empresa de energia do conglomerado criado pelo empresário, é mais um capítulo da crise que assola o outrora homem mais rico do Brasil, à luz de perspectivas menos otimistas para o futuro da economia do país.

Em fato relevante divulgado na quinta-feira, a MPX informou ao mercado que uma assembleia geral será convocada em breve para deliberar sobre a saída de Batista e a alteração da denominação social da companhia. Uma oferta de ações inicialmente prevista também foi cancelada e substituída por um aumento de capital privado.

Por trás da decisão, há uma tentativa de acalmar o mercado e interromper a sangria que já lhe custou grande parte de sua fortuna.

Por ser um de seus ativos mais valiosos, a MPX tem importância vital no plano de reestruturação do conglomerado EBX, que reúne quase duas dezenas de empresas criadas pelo empresário.

A intenção inicial seria vender a MPX e a MMX (mineração) para amortizar parte das dívidas de outras companhias do grupo.

Mas segundo o jornal Valor Econômico, estaria em curso um plano maior, de desmembramento do conglomerado, que incluiria a venda de empresas inteiras, diluições de participações e renegociações de dívidas.

A Batista caberia "uma participação minoritária nos maiores empreendimentos ou uma ou outra empresa de menor expressão do grupo", informa o diário em uma reportagem publicada na quinta-feira.

Decepção

No início da semana, a forte queda das ações da OGX (petróleo) puxou para baixo o desempenho da Bovespa, a bolsa brasileira, que se descolou dos mercados internacionais.

Os investidores reagiram mal ao anúncio de que a empresa interromperia a produção nos campos de Tubarão Azul, na Bacia de Campos (Rio de Janeiro), no ano que vem por inviabilidade econômica.

A declaração contribuiu para aumentar ainda mais a crise de confiança que vinha pairando sobre as empresas de Batista, na esteira da deterioração do cenário macroeconômico brasileiro".

Source:   BBC Brazil

China's Natural Gas Consumption will account for 10% of total annual energy consumption by 2020

 Natural gas consumption will account for 10 percent of China's annual total primary energy consumption by 2020 from the current 3.9 percent level, PetroChina Company Limited Chairman Zhou Jiping forecast Tuesday.

Chinese demand for natural gas will increase over the coming 10 years, and by 2020, China will consume 300 billion cubic meters of natural gas a year, Zhou said at the 2010 International Oil and Gas Conference held here.

Annual increases in PetroChina's natural gas proven reserves have exceeded 400 billion cubic meters for three years in a row, Zhou said.

The company produced 68.3 billion cubic meters of natural gas in 2009, accounting for 80 percent of the nation's total production.

Retail Industry in china will mantain sustainable growth in the medium and long term

Despite China's slowing economic growth, the retail industry in the world's second-largest economy will maintain sustainable growth in the medium and long term, commerce officials said on Thursday.

Meanwhile, the industry is undergoing a transformation and the government will make more efforts to enhance its quality and efficiency and to optimize its structure.

"Following the restructuring process of the economic growth model, the improvement of the consumption structure, the advancing urbanization, and especially the development of e-commerce, China's retail industry in the remainder of the 12th Five-Year Plan (2011-15) will keep steady growth," Wang Desheng, deputy director of the department of circulation industry development at the Ministry of Commerce, told a news conference on Thursday.

Source: Xinhua

Larry Summers Front Runner to be next Fed Chairman?

According to an article published today in the Wall Street Journal, Larry Summers the former top economic adviser for Mr Obama,say some of the friends of the former,it is more than interested in replacing Fed Chairman Bernanke.
If picked, Mr. Summers would bring a range of government, academic and financial-market experience that Mr. Obama could find hard to replicate. Mr. Summers was chief economist at the World Bank and helped the Clinton Treasury navigate financial crises in Latin America and Asia.
Mr. Summers is widely considered one of the top economists of his generation. He is known for being able to quickly and clearly analyze economic issues, identify the challenges and conceptualize solutions.
But to his detractors—of which there are also plenty—he is an overbearing smarty pants who could be a bull in the collegial Fed china shop.

Precious Metals Quotes

Gold Price Futures     3months        1,220.85

Silver Price Futures    3months            18.84

Target Of China's Government 10 Top Chinese steel makers to produce 60%+ of total output by 2015

China expects its top 10 steel makers to produce more than 60 percent of the country's total steel output by 2015, according to a document published on the government's website Thursday.

China is encouraging its big steel companies to acquire other smaller ones to cut emissions, and restructure so to consolidate the steel industry. It aims to create three to five major steel companies that will compete in the international market, according to the document issued by the General Office of the State Council.

The government said it would encourage domestic steel mills and iron ore firms to set up reliable iron ore bases overseas and for big steel companies to establish plants overseas.

Source: Xinhua

New Safety Guidelines for Japanese Utilities.

Updated nuclear safety guidelines took effect on Monday for Japanese utilities.

The new guidelines will also require operators to be prepared for higher tsunami and more powerful earthquakes than under the current rules, and prevent accidents like the one it ocurred in Fukushima Daiichi plant in 2011.

Four utilities are to file applications on Monday to restart 10 reactors at 5 power plants. They are Hokkaido Electric Power Company's Tomari plant, Kansai Electric's Ohi and Takahama plants, Shikoku Electric's Ikata plant and Kyushu Electric's Sendai plant.

Source: NewsonJapan

TPP would affect 47 prefectures in Japan

Annual agriculture income in Japan would plunge 14 pct to 2.5 trillion yen from the average of 2.9 trillion yen in 2006-2010 if Japan joins the Trans-Pacific Partnership free trade pact and all tariffs in the nation are removed immediately as a result, an anti-TPP group said Friday.

Income would drop in all of Japan's 47 prefectures, according to the estimates by the group comprising university teachers.

Source:NewsonJapan

Trade talks between E.U. and U.S.

Talks to create the world's biggest free-trade zone between the E.U. and U.S. are going to start  amid a controversy of spying to their allies by U.S. agencies and demands of protected industries.
France for example has demanded protection for its film and television industry.

"Direct tariffs on goods and services between the two are already low, but there are other barriers such as regulatory and safety standards, inspection procedures, and preferences for domestic business.

Removing these could significantly reduce the costs for companies doing transatlantic business".

"Last year, trade in goods between the United States and the EU was worth some 500bn euros ($650bn), with another 280bn euros ($359bn) in services and trillions in investment flows".

Source :  BBC

Greece close to an EU agreement

Greece's government has said it is close to agreeing a deal to gain the latest payment of bailout money from its international lenders.

Talks have centred around 4,000 civil service jobs that are due to be cut.

Greece must pay off 6.6bn euros of debt by mid-August.

Source: reuters

Brazil. Eike Batista Misfortunes . These are his worst performing companies.

The market price meltdown of Brazilian billionare Eike Batista´s companies.

Market Value in R$ Billions                                 Market Value in R$ Billions

OGX (Oil and Gas)                                               OSX(Shipbuilding and Offshore)

41.05    june 2008     4.47  may 2013                     7.8B march 2010   0.86B may 2013

 Cash Available  2.3 billions                                 Cash Available   1.3 billions

 Total debt           7.9 billions n                             Total debt March   5.4 billions
                                                                               2013

%Debt in             92%                                       %Debt in                    72%
Foreing  Currency                                                 Foreign Currency

Timing of the Fed or who gets out first from the(once) safe bond market. Part II

The gradual stance that the Fed will take in tapering its bond purchases and the slower growth of China's economy, with the continuing accomodative monetary policy in Japan and U.K both countries simply  have concluded that higher inflation is a price worth paying to revive economic growth. 
After the ECB meeting which left interest rates unchanged,  Chairman Mario Draghi on a news conference said that:

"The Governing Council expects the key ECB rates to remain at present or lower levels for an extended period of time, Monetary policy will remain accommodative for as long as necessary." "Our exit (from low interest rates) is very distant," he added.

 So the gradual exit from easy money by the Fed will be in a complex international  scenario,with falling prices of commodities which are already painful for emerging markets and developing economies with less growth in their economies,depreciation of their currencies, falling bond prices,tighter monetary,  higher interest rates, and falling prices of asset classess. This is the unraveling of the previous scenario of extremely low interest rates in the U.S and weak dollar policy.

  Higher interest rates and  (U.S. rates will be the benchmark), will mean also lower commodity prices enhancing the fall because of the lower growth of the Chinese economy.

   Once the market is convinced that the tapering of bond buys is without a step back,the fall of the bond prices will faster and deeper than U.S. monetary authorities thought, or the tapering will be done in a longer period than initially was thought.

Barrick's Impairment Charge for 2013

Impairment Charges

In its first quarter 2013 report, Barrick indicated that it may need to reassess the long-term gold and silver price assumptions used in its most recent annual impairment test should metal prices remain at lower levels for an extended period of time.

As a result of recent and continued significant declines in gold and silver prices, and the delay in first gold production, Barrick is conducting impairment testing. Preliminary analysis indicates an after-tax asset impairment charge in the range of approximately US$4.5-US$5.5 billion in the second quarter for the Pascua-Lama project. This is a preliminary estimate range and the impairment testing work is ongoing, including with respect to various underlying assumptions related to items such as long-term metal prices, capital costs, and the construction schedule re-sequencing work for the project. The company will complete a final impairment assessment by its second quarter 2013 results release.

In light of the lower metal price environment, Barrick is also reviewing its other assets, including goodwill, for possible impairment charges in the second quarter, which, although dependent on various analyses and assumptions which have not been finalized, are likely to be significant.

Source: Form 6-K 5fth of day July 2013

Dollar Index at 3 Year High

A widely used measure of the dollar’s value rose to a three-year high Friday after stronger-than-expected June U.S. jobs data reinforced expectations the Federal Reserve will move sooner rather than later to begin slowing the flow of monetary stimulus to the economy.

The ICE dollar index DXY, which measures the U.S. unit against six other major currencies, rose to 84.434, up from 83.291 late Thursday in North America. On a closing basis, that’s its highest in three years, according to FactSet.

Sugar Prices Crush Impact in India

This is a good time for buyers of refined sugar, but for refiners in India, the world’s biggest consumer of the sweetener and the second largest producer, not so much.

Global sugar prices have fallen to their lowest levels in nearly three years, and surplus production of cane in India isn’t helping the situation, with share prices of listed sugar companies in the country getting crushed.

Benchmark ICE sugar traded in New York has fallen from a high above 35 cents a pound in February 2011 to around 16 cents a pound recently. In the year to date, it has fallen a relatively subdued 16%, but stock prices for Indian refiners have fared much worse.Shree Renuka Sugars Ltd.India’s biggest sugar refiner, is the worst performer, having lost around 48% of its stock value in 2013  Bajaj Hindhustan Ltd. India’s top sugar producer by volume, has lost 40%, while other significant players Balrampur Chini Mill Ltd. and Simbhaoli Sugars Ltd.  have shed 19% and 36%, respectively. All of the companies’ share prices are around three-year-low levels.

Analysts say they expect sugar share prices to stay at depressed levels at least for the next several months, potentially hitting four-year lows given the limited scope refiners have to eke out profits.

From WSJ

Gold Majors' Shares Steep Drop

Canada's main stock index stumbled on Friday after a robust U.S. jobs report showed growing strength in the world's largest economy but lessened the appeal of safe-haven assets such as bullion, causing gold-mining stocks to dive.

Shares of gold producers dropped almost 5 percent, with Barrick Gold Corp  the world's largest gold miner, losing more than 5 percent of its market value to hit its lowest level in about 21 years.

Increasing signs that U.S. economic recovery is gathering speed raised fears that the Federal Reserve might dial down its massive stimulus program later this year.

Data showed U.S. job growth was stronger than expected in June and that the employment count for the previous two months was higher than initially reported.he materials sector, which includes mining stocks, declined the most among the major groups, giving back 2.1 percent. Gold miners tumbled in a volatile session after the price of the precious metal fell, with the U.S. dollar rising on the jobs news.

Barrick fell to $13.52, hitting its lowest level since May 1992.

Source Reuters

A closer look to the U.S. June's Jobs Report

According to June labor Statistics, total nonfarm payroll employment increased by 195,000 in June, and the unemployment rate was unchanged at 7.6 percent, the U.S. Bureau of Labor Statistics reported today. Employment rose in leisure and hospitality, professional and business services retail trade, health care, and financial activities.
The number of unemployed persons, at 11.8 million, and the unemployment rate, at 7.6 percent, were
unchanged in June.
Among the major worker groups, the unemployment rate for adult women (6.8 percent) edged up in
June, while the rates for adult men (7.0 percent), teenagers (24.0 percent), whites (6.6 percent), blacks
(13.7 percent), and Hispanics (9.1 percent) showed little or no change. The jobless rate for Asians was
5.0 percent (not seasonally adjusted), down from 6.3 percent a year earlier.
In June, the number of long-term unemployed (those jobless for 27 weeks or more) was essentially
unchanged at 4.3 million. These individuals accounted for 36.7 percent of the unemployed. Over the
past 12 months, the number of long-term unemployed has declined by 1.0 million.
The number of persons employed part time for economic reasons (sometimes referred to as
involuntary part-time workers) increased by 322,000 to 8.2 million in June. These individuals were
working part time because their hours had been cut back or because they were unable to find a full-time
job.
In June, 2.6 million persons were marginally attached to the labor force, essentially unchanged from a
year earlier. (The data are not seasonally adjusted.) These individuals were not in the labor force, wanted
and were available for work, and had looked for a job sometime in the prior 12 months. They were not
counted as unemployed because they had not searched for work in the 4 weeks preceding the survey.
Among the marginally attached, there were 1.0 million discouraged workers in June, an increase of
206,000 from a year earlier. (The data are not seasonally adjusted.) Discouraged workers are persons not
currently looking for work because they believe no jobs are available for them. The remaining 1.6
million persons marginally attached to the labor force in June had not searched for work for reasons
such as school attendance or family responsibilities.

Source   Bureau of Labor Statistics

Basel Committee New Standards for Risk

Global regulators proposed on Friday that banks set aside more capital to cover investments in "shadow banks" such as private equity or hedge funds to improve cover for underlying risks.

Policymakers worry that as mainstream banks become more tightly regulated, risks will shift to other financial businesses that handle credit but have been less regulated than the banks.

The Basel Committee of banking supervisors from the world's top financial centers said on Friday that more clarity and consistency is needed on its existing rule for how banks set aside capital to cover exposure to equity funds.

Basel will make it a requirement for banks to adopt a "look-through" approach, meaning that banks will have to calculate risks from their exposure to a fund as if they owned the fund. A public consultation on the proposed change will close on October 4.

"The committee believes the revised standard will more appropriately reflect the risk of a fund's underlying investments and its leverage," the committee said in a statement.

"The revised standard will also help address risks associated with banks' interactions with shadow banking entities."

Source  Reuters

Precious Metals Quotes

Gold Price    3 Months Futures     US$      1,211.47

Silver Prices 3 Months Futures     US$          18.79

Government Bonds Quotes

Government Bonds			Price change	YIELD
U.S. 2 Year			-2/32	0.391
U.S. 5 Year			-24/32	1.575
U.S. 10 Year			-1 18/32	2.697
U.S. 30 Year			-2 25/32	3.662
Germany 2 Year			-3/32	0.137
Germany 10 Year			-30/32	1.728
Italy 2 Year			6/32	1.963
Italy 10 Year			3/32	4.395
Japan 2 Year			0/32	0.139
Japan 10 Year			3/32	0.859
Spain 2 Year			9/32	1.914
Spain 10 Year			20/32	4.592
U.K. 2 Year			-3/32	0.411
U.K. 10 Year			-29/32	2.501

A bright spot on U.S. job growth.

U.S. job growth increased more than expected in June, which could draw the Federal Reserve closer to implementing a plan to start scaling back its massive monetary stimulus later this year.

Employers added 195,000 new jobs to their payrolls last month, the Labor Department said on Friday, while the unemployment rate held steady at 7.6 percent as more people entered the workforce.

The government revised payrolls for April and May to show 70,000 more jobs created than previously reported.

Economists polled by Reuters had expected employment to increase 165,000 last month and the jobless rate to fall a tenth of a percentage point to 7.5 percent.

The closely watched employment report was released two weeks after Fed Chairman Ben Bernanke offered an upbeat assessment of the economy's outlook and said the U.S. central bank expected to start trimming its bond purchases later this year.

The employment report also showed weekly hourly earnings rose by the most since November. That, combined with other relatively upbeat data on housing, auto sales and manufacturing, makes it more likely the Fed will proceed with its tapering plan in September.

wenty-eight of 60 economists polled by Reuters in late June said they expect the Fed to begin dialing back its purchases in September, with most expecting the program to end by June 2014.