Macroeconomics

Macroeconomics




· In US, President Obama said recent data suggest that US economy is returning to growth and the administration must avoid removing stimulus programs prematurely. The White House expects the $787bn stimulus to add as many as 3% points to growth in Jul through Sep, and it credited the initiative with creating or saving as many as 1.1m jobs.



· The Euro industrial output fell 0.3% in July as the economy struggles to recover. Manufacturers across Europe are cutting costs and output to improve earnings as domestic and foreign spending on machinery, cars and metals continue to contract. Employment has declined for consecutive 4Qs and the jobless rate rose to the highest in more than 10 years in Jul.



· Bank of Japan will probably keep their benchmark interest rate near zero this week and maintain emergency lending programs as the economy recovery shows signs of losing momentum.



· At home, Malaysia’s CPI likely fell for a 3rd straight month in Aug but at a slightly slower pace than in July. Aug CPI likely fell 2.35% from a year earlier following a fall of 2.40% in Jul. Aug’s decline was largely due to the lingering base effect from last year when global food and energy costs were spiking, but that this month’s consumer prices might grow due to taxi and bus fare hikes.