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February 13, 2013
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  • Fearing currency war, G7 affirms market orientation
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    Responding to Japan's new policies apparently targeting a certain rate of inflation, the Group of Seven said it remains committed to market determination of currency values in a bid to avert a currency war. "We reaffirm that our fiscal and monetary policies have been and will remain oriented towards meeting our respective domestic objectives using domestic instruments, and that we will not target exchange rates," G7 finance ministers and central bank governors said in a statement. The Wall Street Journal (2/12) LinkedInFacebookTwitterEmail this Story

  • Japan's Abe affirms inflation targeting in tandem with fiscal stimulus
    Japanese Prime Minister Shinzo Abe affirmed that the Bank of Japan must work to meet the 2% inflation target but said fiscal stimulus is a necessary partner in the effort to revive the nation's economy. "It is possible to achieve the 2% inflation target with monetary policy, but fiscal stimulus is needed to support the economy as well because it would take time for wages to start rising," Abe told lawmakers. Fox Business/Reuters (2/12) LinkedInFacebookTwitterEmail this Story
  • India's factory production falls; inflation rises
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    India's factory output defied expectations and declined for a second month in December, adding to worrying signs for the wider economy, which has eased to its slowest rate of expansion in a decade. "This set of data is really bad, and there is a need to aggressively address risks to growth," said Rupa Rege Nitsure, an economist at Bank of Baroda in Mumbai. Meanwhile, retail inflation picked up to 10.79% in January. Bloomberg Businessweek (2/12) , The Hindu (India)/Press Trust of India (2/12) LinkedInFacebookTwitterEmail this Story

  • U.S. job openings down in December
    Adding to signs of a sluggish U.S. labor market, the number of job openings in December dropped from the previous month. But the downturn may have been due to year-end anxieties centered on uncertainties over raising the U.S. debt limit. Looking ahead, however, "we're still going to see that relatively modest pace of advancement in the first part of 2013 as businesses wait to see how the adjustments with payroll taxes and spending cuts affect the economy," said Russell Price, a senior economist at Ameriprise Financial. Bloomberg Businessweek (2/12) LinkedInFacebookTwitterEmail this Story
  • U.S. Fed vice chair voices skepticism of austerity
    Economic growth in the U.S. and Europe may be weakened by misguided austerity policies, U.S. Federal Reserve Vice Chair Janet Yellen said. Higher unemployment and stymied growth, Yellen said, could undermine the purported purpose of continued fiscal restraint. Reuters (2/11) LinkedInFacebookTwitterEmail this Story

  • Moody's sees waning global risk amid sub-trend growth
    Although its overall forecast for the world economy is little changed, the risks that recently threatened have abated somewhat, the rating service says. "We still expect a subdued global recovery with sub-trend growth in most advanced economies over the near term, alongside a relatively soft pace of expansion in emerging markets as well," Moody's says, The Economic Times (India)/Reuters (2/12) LinkedInFacebookTwitterEmail this Story
  • S&P parent says U.S. fraud case is unsupported by evidence
    Standard & Poor's parent McGraw-Hill dismisses the U.S. government's $5 billion lawsuit in connection with the economic meltdown, saying the case is weak. "The company does not believe the Department of Justice can prove that this failure -- common to nearly everyone at the time -- was the product of intentional misconduct by anyone at S&P," McGraw-Hill said. However, the company opened the door to what it described as a reasonable settlement. Reuters (2/12) LinkedInFacebookTwitterEmail this Story
  • Emerging-market banks gain as big banks retrench
    China's Citic Securities is among the investment banks in emerging markets that are gathering new business as their big Western counterparts lose share due to new regulation and cost-cutting pressures. "It's always the case in banking -- as one set of players goes off the pitch because they’re injured, you get another set of players who come on to try and play the same game," said Paul Skelton, Dubai-based regional co-head of global banking in the Middle East and North Africa for HSBC Holdings. Bloomberg (2/11) LinkedInFacebookTwitterEmail this Story
Reining in Risk
CFA Institute report: Investors need better disclosure of derivatives and hedging activities

Read the Report
  Market Activities 
    Bank shares led by Barclays, with announced plans for a new global strategy, helped elevate stocks Tuesday in Europe. In the U.S., earnings reports and anticipation over President Barack Obama's State of the Union speech kept a lid on shares. The Stoxx Europe 600 rose 0.51% to 287.07, and the S&P 500 added 0.16% to 1,519.43. Here is a continuously updated list of global stock indexes. The Wall Street Journal (2/13) , The Wall Street Journal (2/12) , CNNMoney (2/12) LinkedInFacebookTwitterEmail this Story
  • Asian shares advance; Kospi hesitates as North Korea tests nuke
    Asian shares were generally up, led by Japan on further indications of aggressive monetary policy. But South Korean shares fell back a bit as North Korea announced another nuclear test. The Nikkei surged 1.94% to 11,369.12, the Hang Seng edged up 0.16% to 23,215.16 and the S&P/ASX was virtually unchanged at 4,958.98 while the Kospi lost 0.26% to 1,945.79. Bloomberg Businessweek (2/12) LinkedInFacebookTwitterEmail this Story
  Economic Trends & Outlook 

  • Australia business confidence ticks up, but signs of weakness spread
    Although Australian business sentiment improved a bit last month, there were also indications that weakness was spreading to more sectors, according to National Australia Bank. "People are a little bit more relaxed because the equity market's gone up ... but I still think the economy is now starting to soften significantly and we're seeing for the first time some signs that the stronger parts of the economy are starting to weaken a little bit," said NAB chief economist Alan Oster. The Sydney Morning Herald (Australia) (2/12) LinkedInFacebookTwitterEmail this Story
  • Indonesia sticks with record-low benchmark rate
    Inflationary pressure was probably a factor as Indonesia's central bank elected not to adjust its benchmark interest rate, which is already at a record-low 5.75%. "By keeping the rate, Indonesian 10-year bonds are more attractive compared to other countries. Indonesia remains an investment destination and it will have a positive impact on the rupiah," commented Branko Windoe, head of treasury at PT Bank Central Asia. Bloomberg Businessweek (2/12) LinkedInFacebookTwitterEmail this Story
  • Philippine exports fall short of goal
    Philippine exports grew 7.6% last year from 2011, boosted by a 16.5% year-on-year gain in December to round out 2012. However, the yearly figure fell short of the government's 8% target, itself a late revision from an earlier projection of 12%. Business World (Philippines) (2/12) LinkedInFacebookTwitterEmail this Story
  Capital Markets & Financial Products 

  Industry & Regulatory Update 
  • Barclays targets Asia, Europe for job cuts
    Barclays' Asian and European equities businesses are among the targets for shrinkage as the bank plans to cut 3,700 jobs over the next three years. The move scales back expansion plans previously set in place by former chief Robert Diamond. The Wall Street Journal (2/12) LinkedInFacebookTwitterEmail this Story
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