Asian Development Bank cuts growth forecast

Asian Development Bank (ADB) has cut its outlook for developing Asia, citing slower growth in China and India.

The bank added that concerns over the US scaling down a key stimulus measure, the quantitative easing (QE) programme, will also affect the region's growth.

Speculation over the US scaling back the programme has seen many investors pull out money from the region.

The ADB has cut its growth forecast for the region, which includes 45 nations, to 6% for 2013, from 6.6%.

"Asia and the Pacific 2013 growth will come in below earlier projections due to more moderate activity in the region's two largest economies and effects of QE nervousness," said Changyong Rhee, chief economist of the ADB.

The bank also revised down the growth forecast for the region for 2014 to 6.2%, from its earlier projection of 6.7%.

Call for reforms

China, Asia's largest economy, has seen its growth hit by a decline in demand for exports from key markets such as the US and Europe.

Its growth rate has slowed for two quarters in a row.

Over in India, a slowdown in sectors such as manufacturing, coupled with a lack of reforms in key areas, has seen the country's growth hit its lowest level in a decade.

In its latest report, the bank also warned that growth in South East Asia will be hampered by weak performances in Thailand, Indonesia and Malaysia, due to weak exports from these economies.

The bank said that the slowing growth "highlights the need to push ahead with overdue reforms in areas like foreign direct investment, infrastructure development, fiscal consolidation and social protection programs" in the region's economies.

It said that these reforms were key to sustaining the long-term growth of the region.

Source: BBC

Italy:il tasso di disoccupazione giovanile supera il 40%

È un record ma di quelli allarmanti: il tasso di disoccupazione giovanile (15-24anni) supera in Italia per la prima volta il 40%. Lo certifica l’Istat secondo cui ad agosto il tasso è aumentato di 0,4 punti percentuali su luglio e di 5,5 punti su base annua. Viene così superata per la prima volta la soglia del 40% e raggiunto il livello più alto dall’inizio sia delle serie Istat mensili (2004) sia trimestrali(1977).
   Ma l’emergenza non riguarda solo i giovani. Aumenta, anche se di poco, il tasso di disoccupazione nazionale che si attesta al 12,2%, in aumento di 0,1 punti percentuali rispetto al mese precedente e di 1,5 punti nei dodici mesi. 

Ad agosto l’occupazione maschile diminuisce dello 0,4% in termini congiunturali e del 2,8% su base annua; quella femminile invece cresce dello 0,5% rispetto a luglio e dello 0,4% nei 12 mesi. Il tasso di occupazione maschile quindi, pari al 64,7%, diminuisce di 0,2 punti percentuali rispetto al mese precedente e di 1,9 punti su base annua. Quello femminile invece, pari al 47,1%, aumenta di 0,2 punti in termini congiunturali e di 0,3 punti percentuali su anno.

I dati sulla disoccupazione giovanile arrivano proprio nel clic day, ossia nel corso della giornata in cui sarà possibile prenotare gli incentivi per le assunzioni degli under 30.Incentive fortemente voluti dal governo Letta nel decretoLavoro. «Mi aspetto che il Clic Day di oggi sia un flop» ha detto il leader della Uil Luigi Angeletti, spiegando che il «clima non ispira. Non vedo imprese che al di là delle belle parole mettono i soldi» per le assunzioni di giovani. «Il dato sulla disoccupazione — ha aggiunto il leader della Cisl Raffaele Bonanni — dá la misura di come la realtà cruda del paese abbia bisogno di un sussulto di responsabilità da parte di ciascuno».

Corriere della Sera

Japan's luxury fruit boutiques

With melons that sell for the price of a new car and grapes that go for more than $100 a pop, Japan is a country where perfectly-formed fruit can fetch a fortune.

An industry of fruit boutiques has defied Japan's sluggish economy to consistently offer luscious and lavishly tended produce for hefty prices -- and it is always in demand.In July, a single bunch of "Ruby Roman" grapes reportedly sold for 400,000 yen ($4,000), making the plump, crimson berries worth a staggering 11,000 yen each.
Every May, a pair of canteloupe melons grown in the north of Hokkaido is auctioned off. They regularly fetch the price of a modest new car.
The hammer fell on this year's pair at a cool 1.6 million yen.
While such cases are at the extreme end, top-notch fruit is a valuable commodity in the world of business and as a seasonal gift, signifying just how much importance the giver attaches to the relationship.
"Most of our products are for gift purposes, so we collect large and high-grade products from all around Japan," says Yoshinobu Ishiyama, manager of a branch of Sun Fruits at Tokyo Midtown, a glitzy office-commercial complex that is also home to a Ritz Carlton Hotel.

Inside his bright, white-tiled emporium, an array of mouth-watering fruits gives off a heady, brain-tingling aroma as soothing music lulls his well-heeled customers.
While Ishiyama doesn't have anything you could trade for a mid-range auto, he does have a slightly more affordable example of the "Ruby Roman" grapes -- a snip at 31,500 yen for a bunch.
A single white peach -- flavourful, perfectly round and about the size of a newborn baby's head -- goes for 2,625 yen. A bunch of Muscat of Alexandria grapes has a 7,350 yen price tag.
Then, there is the unrivalled symbol of expensive gifts in Japan: musk melons.
Sitting in individual wooden boxes on the top shelf of a glass-door refrigerator at the back of the shop, they will set you back as much as 16,000 yen.
There are also square watermelons -- grown in plastic boxes and usually for decoration -- which start at 5,000 yen.

NewsOnJapan

China's railways carried a record high of 10.33 million passengers

 China's railways carried a record high of 10.33 million passengers on Tuesday, the first day of the seven-day national holiday, according to China Railway Corporation.

The volume marked a year-on-year increase of 13 percent, the corporation said.

To cope with surging demands during the period, China has put thirty-one pairs of additional trains into temporary service.

The Ministry of Transport expects more than 610 million passengers to travel on roads and waterways during the period.

Source: Xinhua

China manufacturing growth Sept. hits 17-month high

China's manufacturing activities set a 17-month record high in September, an official survey showed, indicating a stable economic rebound.

China's Purchasing Managers' Index for the manufacturing sector rose to 51.1 percent in September from 51 percent in August, the National Bureau of Statistics (NBS) and the China Federation of Logistics and Purchasing said on Tuesday.

A reading below 50 indicates contraction, while anything above signals expansion.

It was the third consecutive month for the index to climb month on month, and September's figure was the highest recorded since May 2012.

Zhang Liqun, researcher at the Development Research Center of the State Council, said the index edged up slightly, but the growth rate was not dramatic, indicating weak rebound momentum.

The sub-index for new orders climbed to 52.8 percent, up 0.4 percentage points month on month.

The sub-index for new export orders gained 0.5 percentage points month on month to reach 50.7 percent in September, while the sub-index for production hit 52.9 percent, up 0.3 percentage points from the previous month, setting a four-month high.

The sub-index for purchasing quantity was 52.5 percent, an eight-month record high. The sub-index for purchasing prices of major raw materials was 54.5 percent, up 1.3 percentage points from the previous month.

Enterprises are more confident in the future of the market, as is reflected in their active purchasing, said Zhao Qinghe, a senior NBS statistician.

However, despite the overall positive signs, growth is imbalanced as large and medium-sized enterprises are improving, but small companies are still having difficulties, Zhao said.                                                 A breakdown by enterprise type shows that the large enterprise PMI rose to 52.1 in September, PMI for medium-sized enterprises edged up to 49.7, while the small enterprise PMI fell to 48.8.

J.P. Morgan China economist Zhu Haibin attributed the recent recovery in growth momentum to several factors.First, a shift in economic policies since July, including balanced emphasis on consumption and investment and clarification on the growth floor, helped boost market confidence and support market activity.  Manufacturing investment, which has continued to decelerate over the past two years, started to recover in August, he added. 

Central bank has improved  support of credit to the real economy.

Third, external demand has benefited from improved growth outlook in advanced economies, especially in the Eurozone, Zhu said.

Source: Xinhua

South Korea:Kia plans to offer Soul electric car in U.S. next year

Kia Motors Corp plans to sell an electric version of its second-generation Soul compact car in the United States next year, the Korean automaker's U.S. unit said on Tuesday.

Kia will start selling the Soul EV in 2014 in a handful of U.S. markets.

But before then, Kia will start selling an updated version of a gas-powered Soul this month.

The Soul EV marks Kia's first all-electric model aimed at the U.S. market, where electric car sales have fallen short of automakers' previous estimates, but are still rising.

The next major U.S. show will be held in late November in Los Angeles, where automakers traditionally show vehicles with advanced powertrains, like hybrids, plug-in hybrids and EVs.

The Soul EV adds a second "green" car to Kia's U.S. lineup after the hybrid version of the Optima sedan that it began offering in 2011.

During the first nine months of 2013, the Soul was Kia's No. 2 best-selling model after the Optima.

Source: Reuters

Brazil judge dismisses a lawsuit to Chevron and Transocean

 A Brazilian federal judge on Tuesday dismissed a lawsuit against No. 2 U.S. oil company Chevron Corp after approving a negotiated settlement, a decision that closes a nearly two-year legal battle over an oil spill in November 2011.

Brazilian prosecutors sought 40 billion reais ($18 billion) in damages from Chevron and offshore drilling contractor Transocean Ltd for a 3,600-barrel leak in the Frade offshore oil field Chevron operates northeast of Rio de Janeiro.

Prosecutors also filed criminal charges against the companies and 17 of their employees. A judge rejected those charges.

The dismissal came after Judge Raffaele Felice Pirro of the federal court in Rio de Janeiro accepted an "adjustment of conduct" deal with Chevron that commits the company to spending about 300 million reais ($135 million) in compensatory activities. Chevron and the government agencies that signed the accord said Transocean had no responsibility for the spill.

The case, the largest-ever environmental lawsuit in Brazilian history, raised questions about the cost of doing business in the nation's high-risk oil business and the ability of prosecutors to assess proper penalties.

While the spill caused no discernible environmental damage, was dispersed within days, never came within 100 kilometers (62 miles) of shore and resulted in no injuries, Chevron and its partners had to stop producing for about a year and a half. Brazilian petroleum regulator ANP fined Chevron for failing to follow drilling plans, but absolved the company of negligence.

The damages sought were many times larger than those U.S. courts awarded plaintiffs against operator BP Plc in the much larger 2010 Deepwater Horizon spill, which fouled beaches, damaged fisheries and killed 11 people in the Gulf of Mexico.

Chevron owns 52 percent of Frade and is the field operator. Brazil's state-run oil company Petroleo Brasileiro SA owns 30 percent and Frade Japão, a joint venture between Japanese trading companies Sojitz Corp and Inpex Corp, owns 18 percent. Petrobras, Sojitz and Inpex were never named in the civil or criminal lawsuits.

Both Chevron and Transocean welcomed the decision in short statements from their press offices. Chevron added that 95.2 million reais, or about a third of the initial settlement value, will be spent on social and environmental programs approved by prosecutors, the ANP and environmental protection agency Ibama.

Source: Reuters

Republicans considering to pass bills funding the Government in pieces

House Republicans are considering a proposal to pass bills funding the government in pieces through mid-December, one day after a budget impasse forced a partial government shutdown.

The proposal by House GOP leaders is being discussed Tuesday with rank-and-file lawmakers. It would fund individual programs or agencies, such as those providing services for veterans or national parks, a House Republican aide said. The narrow spending bills would extend funding at the current sequester levels, around $986 billion on an annual basis, according to the aide.

House Republicans would choose the programs covered by the spending bills, unlike the normal appropriations process that funds the government through an organized set of spending bills covering set areas of government operations. Congress hasn’t approved any routine appropriations bills for fiscal 2014, which began Tuesday.

Source: WSJ

Gold for December delivery dropped $40.90 ounce

Gold futures dropped more than $40 an ounce Tuesday to mark their lowest settlement in almost two months, failing to find safe-haven support with some investors expecting the U.S. government shutdown to be short lived.

Gold for December delivery  dropped $40.90 ounce, or 3.1%, to settle at $1,286.10 an ounce on the Comex division of the New York Mercantile Exchange. Prices, tracking the most-active contracts, saw their biggest one-day dollar loss since June 26, FactSet data show. They also settled at their lowest level since Aug. 7.

On Monday, gold fell $12.20, or nearly 1%, to settle at $1,327 an ounce, but marked the first quarterly gain in a year.

In a daily note, Peter Hug, global trading director at Kitco Metals Inc. also said that the “event that will have the desired impact for the bulls is now 17 days away, when the fight draws to a climax on the debt-ceiling negotiations.”

“If they blow this one, the work accomplished over the past few years will be for naught,” he said.

Source: Marketwatch

Abe orders Japan's first sales-tax increase since '97

Japanese Prime Minister Shinzo Abe proceeded with an April sales-tax increase and will implement a stimulus program as he tries to rein in the world's biggest debt burden without jeopardizing efforts to end deflation.

The levy will rise to 8 percent from 5 percent now, Abe, 59, said in Tokyo today, the first increase since 1997. Abe will unveil the size of a package of stimulus measures later today, the ruling party chief told reporters. Economists have projected a 5 trillion yen ($51 billion) plan that will include public works spending and tax breaks encouraging companies to boost capital spending and wages.With households already hit by a rising cost of living and declines in pay, proceeding with the higher levy enacted by the previous government poses the biggest risk yet to Abe's efforts to end two decades of Japanese stagnation. His next challenge in coming weeks is following through on pledges for domestic economic reforms that persuade companies to invest at home.
The economy will contract an annualized 4.5 percent in the three months after the sales tax is increased in April before returning to growth, according to the median calculation of economists surveyed by Bloomberg News. For the 2014 calendar year, the expansion is seen slowing to 1.6 percent from 1.9 percent this year, the median estimates show. Tailwinds for the world's third-largest economy heading toward the April increase in duties reduce the danger of Abe following in the footsteps of Prime Minister Ryutaro Hashimoto, who in 1997 oversaw a 2 percentage point boost in the levy. The move cost him his job as Japan sank into a recession with consumption swooning against a backdrop of weakening demand abroad due to the Asian financial crisis.

Source: NewsOnJapan

Lawrence Ho, son of Macau gambling tycoon Stanley Ho, is lobbying for Casino gaming in Japan

Lawrence Ho, son of Macau gambling tycoon Stanley Ho, plans to invest more than $5 billion in Japan if Melco Crown Entertainment Ltd. receives permission to build a casino here as he sees constraints on development at home.

Ho's maneuver to build projects in the world's third-largest economy is part of his strategy to expand overseas for future growth, as government policies, limited land and a labor shortage in Macau could eventually restrict gaming development.

"We still have the most eggs in the Macau basket," Ho, co-chairman of Melco Crown, said in an interview in Tokyo on Saturday. "Given the Macau government and the Chinese government want to control the growth rate," the company is seeking other opportunities outside the city, he said.

Ho is investing in gaming projects in the Philippines and Russia in addition to lobbying for casino gaming in Japan. The Macau government has limited the number of gaming tables and hands out land permits at intervals to prevent the industry from growing too fast in a city that's half the size of Manhattan and whose $38 billion in casino revenue last year was six times larger than that of the Las Vegas Strip.

Source: NewsOnJapan

Japan survey shows improved business sentiment

Japanese manufacturers are increasingly optimistic over the business outlook in months ahead, according to a survey released Tuesday in advance of the expected approval of a sales tax increase.

Results from the Bank of Japan's "tankan" quarterly survey showed large manufacturers were especially upbeat, with a reading of positive 12, up from 4 in the July survey.Prime Minister Shinzo Abe was waiting for the survey's release to go ahead with a long-anticipated decision on increasing the sales tax next year to 8% from the current 5%.
He was expected later in the day to announce the Cabinet's approval of that plan, along with tax breaks and other stimulus meant to counter the dampening effect on consumer demand that is expected to follow the tax hike's implementation next April.
The tankan's results contrast with data for August showing higher unemployment and lower household spending. Improved hiring and wages are needed to spur a rebound in consumer spending to help underpin a sustained recovery after years of stagnation.

Brazil: Central Bank revises upwards projected high inflation well into 2015

The Central Bank (BC) has revised upwards its projections for the variation of the Extended Consumer Price Index (IPCA) in 2013 and in the coming years Inflation in Brazil will remain stubbornly high well into 2015 even as the economy struggles to gain steam, the central bank said on Monday, raising market bets for higher borrowing costs in the future.

In its quarterly inflation report, the bank lowered its 2013 inflation forecast to 5.8 percent from 6 percent previously. However, it revised its inflation view for 2014 to 5.7 percent from 5.4 percent previously and said it expects inflation at 5.5 percent in the third quarter of 2015.

The bank also revised down its estimate for economic growth to 2.5 percent for this year from a previous 2.7 percent forecast. The bank sees growth keeping that pace until the second quarter of 2014.

The projections for quickening inflation sparked a rally in the Brazilian currency, the real, as well as interest-rate futures as investors increased bets on a longer monetary tightening cycle that would bring more U.S. dollars into the economy.

Central bank director Carlos Hamilton Araujo added to the rally with hints of further rate hikes, saying there was "a lot of work to be done" in monetary policy to battle inflation.

Source: Reuters

China's top leaders discussed an innovation driven development strategy.

China's top leadership held a group study Monday in a Beijing technology hub known as China's Silicon Valley, the first time such a study has been held outside the central authority's seat at Zhongnanhai.

Analysts said the move signaled the Chinese top leadership's determination to keep in close contact with the masses and seek an innovation-driven development pattern.

Members of the Political Bureau of the Communist Party of China (CPC) Central Committee on Monday morning visited the Zhongguancun Science Park, which, after 20 years of development, now boasts about 20,000 hi-tech companies.

Situated in the northwestern part of Beijing, Zhongguancun is known as the technology hub and is often referred to as the Silicon Valley in Beijing.

Led by Xi Jinping, general secretary of the CPC Central Committee, the Political Bureau members viewed world-class innovative products at Zhongguancun.

They talked with executives and scientists about research and implementation of new technologies such as additive manufacturing, cloud computing, nano materials, bio-chips and precise crop breeding.

After Wan Gang, minister of Science and Technology, explained general situation of China's science and technology innovation, the Political Bureau members discussed the innovation-driven development strategy.

Presiding over the group study, Xi stressed importance of science and technology in enhancing national strength, saying that innovation is a global trend and also a need inside the country.

"We must enhance awareness of unexpected challenges and grab the opportunity of the science and technology revolution. We cannot wait, hesitate or slack," Xi said.

China should focus on integration of innovation with economic and social development, enhance capacity for independent innovation, improve talent development, build a favorable policy environment and expand opening-up and international cooperation in science and technology, Xi said.

The group study is a system China's top leadership uses to study major issues. Since 2002, over 100 experts and scholars have delivered lectures in Zhongnanhai, the seat of the top leadership.

It was the ninth group study of the 18th Political Bureau of the CPC Central Committee, and the first time that the top leadership held a group study outside Zhongnanhai.

Prof. Xin Ming at the Party School of the CPC Central Committee said it was a change in learning style.

"Wherever the development priority is, that is where the classroom should be," Xin said.

In its 18th National Congress in November 2012, the CPC put forward a strategy of innovation-driven development, stressing the importance of scientific innovation in improving productivity and overall national strength.

Xi has also stressed the importance of innovation and science since then. When visiting the Chinese Academy of Sciences in July, he called for a strong command of science to help revitalize the country.

From Zhongnanhai to Zhongguancun, the top leadership can learn about the latest in science and technology development and better understand the problems that need to be addressed, Xin said

Source: Xinhua

British Banks will have a stress test

Banks in Britain may have to hold more capital than their international rivals under proposals for an annual stress test of lenders put forward by the Bank of England on Tuesday.

The BoE spelled out how it will begin checking for the first time that banks do not pose risks to the UK economy by being short of reserves, both individually and as a sector.

It will start an annual test for the top eight UK lenders like Barclays, RBS and HSBC in 2014.

Medium-sized British banks are likely to face a cut-down version of the test, and clearing houses could face their own health checks later on, the central bank said.

"Stress-testing can provide a quantum leap in transparency and accountability," BoE Deputy Governor Paul Tucker said.

Source: Reuters

China's official PMI rose 51.1 in September less than expected.

China's manufacturing activity expanded only slightly last month, raising concerns a nascent economic recovery may be foundering at a time of market uncertainty about a U.S. government shutdown and a political crisis in Italy.

Similar purchasing managers indexes measuring the factory sectors in India, South Korea and Taiwan rose modestly, although the improvements were not enough to give much comfort.

The one bright spot for Asia was in Japan, where a report said on Monday that manufacturing activity expanded in September at its fastest pace since the 2011 earthquake and tsunami.

China's official PMI rose to 51.1 in September from 51.0 in August, data showed on Tuesday. That was still the highest in 17 months, but the increase was less than expected.

A separate China PMI from HSBC on Monday also showed manufacturing activity growing less than expected last month on soft domestic demand.

"The question is how sustainable is the recovery," said Haibin Zhu, chief China economist for JP Morgan in Hong Kong.

"We are still cautious. We see the recovery peaking in Q3 and slowing in Q4 on a sequential basis."

China's economy has shown signs of picking up but the PMI figures suggest it is struggling for momentum. Analysts like Zhu have warned China's economic rebound could be short-lived. Unlike in the past, the government is reluctant to implement strong stimulus policies that could come back to haunt it longer term.

China's struggle adds to a complicated global economic environment for policy makers and investors. The U.S. government began a partial shutdown on Tuesday for the first time in 17 years after lawmakers could not break a political stalemate over spending. It faces another critical deadline in coming weeks to raise its debt ceiling of $16.7 trillion. Failure to find an agreement could lead to a historic U.S. government debt default.

Source: Reuters

U.S. government shutdown begins after Congress fails to break impasse

The U.S. government began a partial shutdown on Tuesday for the first time in 17 years, potentially putting up to 1 million workers on unpaid leave, closing national parks and stalling medical research projects.

Federal agencies were directed to cut back services after lawmakers could not break a political stalemate that sparked new questions about the ability of a deeply divided Congress to perform its most basic functions.

After House Republicans floated a late offer to break the logjam, Senate Majority Leader Harry Reid rejected the idea, saying Democrats would not enter into formal negotiations on spending "with a gun to our head" in the form of government shutdowns.

After missing the midnight (0400 GMT) deadline to avert the shutdown, Republicans and Democrats in the House continued a bitter blame game, each side shifting responsibility to the other in efforts to redirect a possible public backlash.

If Congress can agree to a new funding bill soon, the shutdown could last days rather than weeks. But no signs emerged of a strategy to bring the parties together.

The political dysfunction at the Capitol also raised fresh concerns about whether Congress can meet a crucial mid-October deadline to raise the government's $16.7 trillion debt ceiling.

Source: Reuters