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Oil worry Potential oversupply and Stronger Dollar

Friday, March 6th, 2015

The positive sentiment from the European Central Bank's monetary stimulus fails to support the strengthening of WTI crude oil in the Asian session as concerns the market will be an oversupply and the potential rise in the US dollar makes crude oil prices approaching the lowest prices daily. Crude oil prices rose slightly, trying to stay above $ 50, is now in the range of $ 50.83 / barrel, with daily highs and lows $ 51.14 $ 50.79 daily.

Investors pay attention to nuclear discussions between Iran and the US. Iran's Foreign Minister on Thursday declared a moratorium or 10-year termination on some aspects of its nuclear program may be acceptable, but declined to give further details. Signals long-term agreement between Iran and six major countries of the Middle East would make Iranian crude oil back to flood the market.

On the other hand, US employment data that can positively confirm the US dollar against major currencies if they can be a reason to raise US interest rates in the coming months. High value of the US dollar will add to make crude oil denominated in US dollar becomes more expensive for investors holding other currencies.

The data released by Baker Hughes rig also become the focus of attention in the crude oil markets Friday. Last week the number of active rigs in the US hit a below 1,000 for the first time since June 2011. The market marked decrease in the number of active rigs as the projected level of US crude production

News and Review of European Economic Zone

The ECB began QE March 9, Raise Economic Growth Projections

Friday, March 6th, 2015

The European Central Bank will start quantitaive easing program on 9th March, by buying government bonds and private assets, with a total of € 60 billion per month. The European Central Bank also raised its forecast for economic growth in the euro zone, while this year's inflation projections derived.

The ECB raised its forecast for gross domestic product this year to 1.5% from the previous projection of 1.0%, which was released last December. GDP in 2016 increased to 1.9% from the previous projection of 1.5%.

Inflation this year is expected to reach 0% lower than the previous estimate of 0.7%. 2016, inflation is expected to rise to 1.5% higher than the previous projection of 1.3%, and will reach 1.8% in 2017

News and Review of European Economic Zone

Yield Bond Euro Zone Drops Into Negative Territory

Friday, March 6th, 2015

The Fall yields a number of euro zone member countries indicates that investors ultimately lend to countries badly affected member euro zone crisis, and also gives a negative catalyst for EURUSD touched parity pairing.

Bond yields as Spain, Italy, Portugal fell to a record low on Friday, while the yield on Irish bonds has touched the level of zero percent, while Spanish yields at 0:08%. The Fall yield reflects the increase in bond prices showed high demand.

While in the forex market, the euro fell to its lowest level of new 11-year high against the US dollar, respond to ECB President Mario Draghi's comments that demonstrate commitment bond purchase program worth $ 1.1 trillion, which will begin next Monday.

News and Review of European Economic Zone (Switzerland)

Foreign Currency Reserves SNB Back Up in February

Friday, March 6th, 2015

Swiss foreign currency reserves back touched a new record high last month, indicating that the central bank continues to buy foreign currency in order to limit the strengthening of the Swiss franc exchange rate despite the release limits against the euro in mid-January. Swiss National Bank (SNB) has said it has a foreign currency worth 509 250 billion Swiss francs (US $ 523.17 billion) at the end of February, compared to the revision become 498 463 billion francs in the previous month. SNB took off limits to 1:20 franc against the euro on January 15 last, he said the policy would cost $ 100 billion francs only to be maintained in January.

The weakening of the euro after the ECB said it would begin quantitative easing program Monday next week will re-open speculation of intervention by the SNB in ​​order to limit the strengthening of the franc. SNB on Friday warned that the lifting limit franc exchange rate and volatility in the market may threaten the performance of the economy this year, disrupt payments to the federal and regional governments. Analysts warned that the Swiss economy could fall into recession as a result of the strengthening of the franc.

News and Review of European Economic Zone (Germany)

German Industrial Production Released Positive

Friday, March 6th, 2015

Results of the German industrial production rose in January 2015. Factors winter weather is not too extreme participate impact on activity in the construction sector of the country's largest economy.

Report German industrial production rose 0.6% over the period December 2014. Official figures that exceeded analysts' expectations of Wall Street Journal estimates that industrial production increased by 0.5% per month. The German government also did significant revisions to the data last December, from 1% to 0.1%

Oil Turned Weakens After the EIA report

Thursday, March 5th, 2015

Oil previously gained now turned lower after the Energy Information Administration reported the surge in US oil inventories. Until last week, US oil inventories have risen in eight consecutive weeks.

EIA reported oil inventories in the week ended February 27 rose 10.3 million barrels to 444.4 barrels too. Analysts surveyed by Platts had forecast a rise of 3.7 million barrels. The EIA report also far above the American Petroleum Institute report on Tuesday by 2.9 million barrels. Gasoline inventories are reported unchanged, while distillate fuel fell 1.7 million barrels. Oil inventories at Cushing Oklahoma, the delivery center WTI oil contracts, also reported increased 2.4 million barrels.

The movement of crude oil is also under pressure from the strengthening of the dollar exchange rate. The dollar index against major currencies today rose 0.60% to 95.94 thousand. Activity data of US non-manufacturing sector rose in February, and break the expectations of a decline by economists support the strengthening of the dollar despite the employment data from ADP released lower than expected.

WTI crude oil traded the range of $ 49.73 a barrel at 22:51 pm, away from daily highs $ 51.13, and potentially put an end to the strengthening of a three-day losing streak

News and Economic Review Zone Asia (China)

Chinese PM: Corruption Inhibits Economic Progress

Thursday, March 5th, 2015

Just like in Indonesia, China is still struggling to suppress the action of corruption especially among bureaucrats. Premier Li Keqiang made sure he did not play in the effort to eradicate korupsu.

In reading the Annual Performance Report Government today, Li Keqiang insisted he would not tolerate any act of corruption. He warned that any offender will face serious legal threat, no matter at which level they launch the action.

Seriousness Li apparent when reading the report of performance, where the word 'corruption' called up to 8 times. He claimed that this criminal act is still a major problem in government, which is why he always stressed to the ranks of high integrity. According to the results reported speech Wall Street Journal, Prime Minister Li admitted that there are some small elements in the government who still misusing authority and state money. It was claimed would undermine the achievement of the economic growth target of 7% at the government in 2015. Given the funding cuts spending by elements result in a decrease in absorption of the budget by economic sectors eligible to receive it.

Concrete measures to eradicate corruption began in earnest the Chinese government, one of which is cut funds overseas visits by state officials, vehicles and medical facilities as much as 35%. Prime Minister Li asked his staff to stay away from what is called the driving factors of corruption that formalism, bureaucracy, hedonism and excessive life. China itself is a little country that dared to impose strict punishment to the criminals, the death penalty.

News and Review of European Economic Zone

ECB Hold Interest Rates Reference 0.05%

Thursday, March 5th, 2015

European Central Bank monetary policy in today's meeting, as well as preparing to launch a program quantitaive easing to spur the economy and raise inflation. President of the ECB, Mario Draghi, will hold a press conference at 20:30 pm, and is expected to provide details of the implementation of the QE.

The ECB kept its benchmark rate at 0.05%, and -0.20% deposit rate which means that banks charge if deposit funds at the ECB. ECB policy meeting earlier said it would buy government bonds on a large scale or so-called QE worth € 60 billion from March 2015 to September 2016. The ECB has yet to know exactly when the QE started.

Analysts also expect the ECB will raise economic forecast the euro zone. The projection will be the first after the ECB announced QE last January, and will be the beginning of an idea how big the impact of QE to stimulate the economy and raise inflation from the standpoint of the ECB

News and Review of European Economic Zone (UK)

Bank of England Hold Interest Rates 0.50%

Thursday, March 5th, 2015

According to estimates by economists and market participants, the Bank of England has not changed the monetary policy to keep interest rates at a record low of 0.50% and the total program £ 375 billion quantitative easing. The interest rate has been arrested in the past six years, or since March 2009. Minutes of the monetary policy meeting today will be released on 18 March.

Previous two BOE officials Martin Weale and Kristin Forbes said interest rates may rise in the near future if inflation rose sharply from current levels. Other BOE members, Ian McCafferty said he would observe salary growth data in the next few months before deciding to continue voting to raise interest rates. McCafferty and Weale reportedly chose to raise interest rates between August and December of this year.

To date, the majority of the members of the policy-makers choose to wait and see the extent to which inflation will decline. Last week, Bank of England's inflation projection will come down 0% before returning rise in the coming months. BOE Governor, Mark Carney, said inflation will reach the target of 2% within 2 years.

News and Review of European Economic Zone (Germany)

German Factory Orders Decline In January

Thursday, March 5th, 2015

German factory orders in January dropped dramatically as a result of sufficiently high orders in the previous month, and decreased with large quantity orders. This decline marks the potential for recovery of the country's weak point euro zone's largest economy.

Orders, adjusted for seasonal fluctuations and inflation, fell 3.9% compared to an upwardly revised increase of 4.44% in December. Destatis also reported that domestic orders fell 2.5% and export orders were down 4.8% 9% drop in orders dragged the Euro zone. Orders for investment products such as plant, machinery, and equipment, fell 4.2% worse than the 0.6% drop in orders for consumer goods.

The German economy grew in the fourth quarter to take advantage of low oil prices increase domestic spending. Exporters also enjoy the weakening Euro so as to make products cheaper for foreign consumers. The launch program of quantitative easing in the month the European Central Bank is also seen to be able to add impetus to growth in Germany

Oil Trying to Survive above $ 50 Level

Wednesday, March 4th, 2015

Crude oil prices try to maintain overnight gains, was steady above $ 50 a barrel on Wednesday, didikung by geopolitical tensions in the Middle East and rising oil prices by Saudi Arabia. Investors await weekly US oil supply data later that night for a catalyst driving prices rose after data showed industrial group hikes lower than expected in commercial crude oil supply in the US last week. Saudi Arabia raised the official selling prices for the purpose of sending Asia and the United States on Tuesday, in the latest signal that OPEC's largest exporter see the signal strength of demand.

US crude oil supplies increased last week, while gasoline supplies grew and distilled oil is reduced, according to data from industry group American Petroleum Institute on Tuesday. Libyan forces launched air strikes on oil and air base on Tuesday, increasing the struggle for control in the oil-producing countries a few days before the UN peace discussions will continue in Morocco. Israeli Prime Minister Benjamin Netanyahu warned the United States that it was mengegosiasikan bad agreement with Iran that could trigger a "nuclear holocaust," get a warning from President Barack Obama and the US-Israel rift shows deepened.

News and Economic Review Zone Asia (China)

PBOC Cuts Interest Rate Loan Special

Wednesday, March 4th, 2015

People's Bank of China again took steps to spur the economy by lowering interest rates to businesses. The move comes a few days after it lowered its benchmark interest rate by 25 basis points to 5.35%, as well as deposit rates were also cut by 25 basis points to 2.5%.

The Chinese central bank lowered interest rates specific short-term, also known as the standing lending facility. MarketWatch reported based on the statements of people who did not want his name published, said the PBOC lowered the overnight rate to 4.5% from the previous 5%, and the seven-day interest rate fell to 5.5% from 7%.

China's economy grew 7.4% in the last year, to its lowest level in nearly a quarter of the last century. Many economists expect the Chinese government will lower economic growth forecast this year to 7%

News and Economic Review Zone Asia (China)

The event will be attended Many Chinese Politics Business Circle

Wednesday, March 4th, 2015

The number of the richest people in China who participated in the biggest annual political event in China increased, underlining the close relationship between politics and business in China. More than 200 richest people in China to attend two major political meetings this year, according to local media reports this week, increased from 155 last year. Among them are 36 billionaires, including Li Hejun, who was recently crowned one of the richest man in China by Hurun, wealth tracker Shanghai.

China's parliament, the National People's Congress (NPC), and badang advisors, Chinese People's Political Consultative Conference (CPPCC), both of which will begin its annual meeting session this week and become the focus of global markets to guide the direction of the country's second largest economy in the world. Another delegation to the meeting included the second richest man ranks 3rd in China, Zong Qinghou, CEO of Hangzhou Wahaha beverage company, Pony Ma of Tencent which ranked fifth, and Lei Jun, the founder Xiaomi who served the 10th richest in China.

News and Review of European Economic Zone (UK)

Sterling Slips Post Data Services Sector Activity

Wednesday, March 4th, 2015

The pound sterling weakened against the dollar after the UK service sector activity data released lower than expected. Data put pressure on the British currency are currently overshadowed by political uncertainty ahead of elections in May.

In the last two days of data on manufacturing activity and construction England released better than expected but failed to lift the performance of sterling. Markit report service sector activity index slowed to 56.7 in February from 57.2 the previous month, at the same time break the expectations of a rise to 57.6 by economists.

Market participants currently pending monetary policy of the Bank of England tomorrow, the last policy meeting minutes said officials began talking about when it will raise interest rates.

News and Review of European Economic Zone

Eurozone Retail Sales Rise in January

Wednesday, March 4th, 2015

Retail sales in the euro zone rose four consecutive months in January, and are at the highest rate of increase over the past nine years. Eurostat reported retail sales jumped 1.1% in January from December 2014, well above the 0.2% rise estimated by economists. The statistics bureau also revised the euro zone retail sales rose in December to 0.4% from 0.3% the previous release.

The continued rise in retail sales can describe the increasing purchasing power of consumers due to the falling price of oil. The increase in retail sales in the last four months was able to allay fears the euro zone will enter a period of prolonged deflation. Eurostat on Monday reported a deflationary pressures in February slowed to 0.3% from 0.5% in January.

Although the data is fairly slick, but surveys purchasing managers index showed businesses cut back the price of a challenge that must be faced by the European Central Bank will launch Quantitative easing program this month

WTI oil weakens, dragged Brent Price Decline

Tuesday, March 3rd, 2015

West Texas Intermediate oil futures traded lower on Monday to slip back to below $ 50 / barrel by close of trade, but the price difference is smaller with the European benchmark Brent oil line is also slumped.

Traders take into account the increase in the monthly manufacturing activity and a surprising rate cut from China as well as a series of US economic reports and news of Libyan oil output increases in oil price movements on Monday.

On the New York Mercantile Exchange, oil futures for April delivery fell 17 cents, or 0.3% to settle at $ 49.59 a barrel. Oil prices on Monday largely move above $ 50, but fell to half an hour of trade before the end because of losses in the Brent oil is so intensive.

April Brent oil prices in London's ICE Futures exchange fell $ 3.04, or 4.9%, to settle at $ 59.54 a barrel.

Strengthening the Brent oil price has exceeded the WTI in the last month, with Brent crude rose 18% compared to US oil rose 3.2%, pressured by inventory levels are at record highs.

The price difference between the crude him on Friday widened to its greatest level since January 2014. Although both Brent and WTI are both ended lower on Monday, the difference was narrowed to just under $ 10.

Tim Evans of Citi Futures said that the difference between Brent and WTI oil trading has made the WTI oil rose even though the tone is still weak in the international market. WTI oil on Monday touched its highest level at $51.04.

News and Economic Review Zone Asia (Japan)

Honda: Advanced Easing Risk of Causing Overheat Economy

Tuesday, March 3rd, 2015

Japan's central bank should refrain from taking additional measures for the time being in order to ensure that perkonomian not experience "overheated," according to one economic adviser of Prime Minister Shinzo Abe. In an interview with the Wall Street Journal, Etsuro Honda said that the inflation rate will probably go back down to the zero level due to the decline in global oil prices, but will "start up by itself" around 2% until early 2016. Honda, one of the most vocal advocates towards monetary easing, said the decline in oil prices in the long run will strengthen inflationary pressure by stimulating consumer spending. Honda says that the weakening yan, BOJ easing the impact of current and anticipated increases in the rate of basic pay this year will trigger upward pressure on inflation.

Honda, which is also a Professor of the University of Shizuoka, said that in a situation like this, if the BOJ back to loosen monetary policy inflation rate will rise even higher, and it seems it is not needed. Honda added that even if the rate of inflation fell deeper, as long as the main cause of the decline in oil prices, and for the difference in supply-demand Japan improved, additional easing should not be taken, otherwise the economy can experience the "overheating" in the second half of this year.

News and Review of European Economic Zone (Greece)

Greece Will Face Debt Maturity

Tuesday, March 3rd, 2015

Greece's debt problems back where the new Greek government will face a credit crunch week with the lack of financial assistance from neighboring countries in the near future, so as to provide a serious threat to the fragile economies.

Although Greece has secured an extension of the bailout program last week, but Athens is not given access to cash from the Euro zone and the IMF, due to disburse these funds need the approval of the revised budget austerity programs and economic reforms and turn it into law.

However, this process will likely take several months to negotiate, whereas Greece has had to pay the IMF debt of $ 1.7 billion in March, with the first installment payment of 300 million euros maturing Friday.

This situation will pose a dilemma for the government, whether to drain the country's foreign exchange reserves and further delaying payment on the supplier is a tactic used by the previous Greek government.

News and Review of European Economic Zone (UK)

UK Construction PMI Reaches Highest Level 4-Month

Tuesday, March 3rd, 2015

Projected growth in the UK economy in 2015, the stronger the construction index rose more than expected. The rate of expansion of the UK construction sector bolted thanks to the rapid increase in the volume of new business and the improving economy. Increased activity of the housing sector, commercial, and civil engineering became the main driver of the increase in the index.

A survey of 170 managers conducted independent organaisasi Markit has recorded the most rapid rate of expansion in four months. UK construction PMI index in February shot to 60.1, away ekspekasi decreased to 59.0 compared to 59.1 in the previous month's level. This optimistic projection add encouraging report ahead of the UK general election in May, after on Monday UK Manufacturing PMI index also managed to break the estimation.

The construction sector had a major effect on the UK economy with a decrease in the output of the construction sector restrain the rate of growth of the UK in the final quarter of 2014. This latest report may be points strengthening the UK economy and the market will be looking forward to the next signal the UK economy through the service sector PMI data will be released Wednesday.

News and Review of European Economic Zone (Germany)

Increased consumption, Retail Sales Germany Streaking

Tuesday, March 3rd, 2015

Retail sales figures or German retail sales rose more than expected in January 2015. The high domestic consumption is the reason behind the increase in retail sales at the beginning of the year.

Retail sales in January rose 2.9% (adjusted for seasonal factors) compared to last month's report in December 2014. The ratio of increase exceeded analysts' estimates surveyed Wall Street Journal, which produce an estimated decrease of 0.3%. For an annual basis, retail sales increased 5.3% marking the fastest pace since June 2010 (6%).

German retail sales report itself is an economic indicator that is not default because usually undergo revision. However, recent data indicate that the German domestic economy is strong enough thanks to support the purchasing power of consumers. Research institute GfK last week forecast consumer confidence figures or consumer confidence rose from 9.3 to 9.7 in March.

Some categories that support the increase in retail sales include food, beverages and tobacco with an increase of 3.8% compared to January last year. While the non-food component rose 6.3% and sales via the Internet and electronic mail services rose 14%

Slumping Oil Related Anxiety abundance of Supply

Monday, March 2nd, 2015

US crude oil futures fell more in nearly -2 percent neared $ 48 a barrel after Iran's nuclear program said the agreement is likely to be approved this week if Western nations remove the embargo, which it has the potential to boost the pace of Iran's oil exports and adds an abundance of supply.

So far the US crude oil futures fell -1.63% to $ 48.95 per barrel, after reaching the highest point at $ 49.62 intraday and daily lows at $ 48.71 per barrel.

Other oils negative catalyst is a factor strengthening the US dollar soared to a 11-year high against various major currencies respond PBOC benchmark interest rate cuts that triggered the downfall of the yuan exchange rate and wounding a number of countries emergin currency, the US dollar boosted otherwise

News and Economic Review Zone Asia (Japan)

Japan Vehicle Sales Not Recovered

Monday, March 2nd, 2015

Japan's domestic sales of new vehicles crept up but have not been able to give a positive signal associated economies of the world's third largest economy. Automotive sales, as measured by the vehicle is registered to government data, the attention of economists as the vehicle is the first consumer spending data are released every month.

With 660 cc minicar sales dominate the trade volume by 40%. Domestic sales of new automotive in Japan in February, excluding minicars, fell 14.7% to 482 103 vehicles. This is a losing streak in the second month, according to data from two industry associations.

The Japan Automobile Dealers reported a 14.2% drop in sales of cars, trucks, and buses be 288 348 vehicles. Japan Light Motor Vehicle and Motorcycle Association adds completeness of the data with a decrease of 15.4% reported annual sales of 193 755 minicar into a vehicle

News and Economic Review Zone Asia (China)

HSBC China Manufacturing PMI Being in High Level 7 Months

Monday, March 2nd, 2015

China's manufacturing sector activity rose to a seven-month high in February, but the level of export orders contracted and deflationary pressures still exist, according to HSBC business survey results on Monday, showed the fragility of the economy that may require policy support. China's central bank cut interest rates on Saturday, a few days before the annual meeting of China's parliament, in the latest attempt to shore up the country's second largest economy in the world is in line with slowing momentum. PMI manufacturing sector by HSBC / Markit rose to 50.7 in February, the highest level since July, from 49.7 in January, following the increase in the overall level of new orders. The figure was higher than the previous release on 50.1, which is slightly below the 50 level that separates between growth and contraction.

But even after the pace of manufacturing sector activity quickened last month, a survey showed the manufacturing sector is still difficult to face an uncertain export and deflationary pressures. Sub-index of the level of new export orders turu be 48.5 in February, the sharpest contraction in a year, while the output and input prices dropped for the 7th month. Work manufacturing sector contracted for the 16th consecutive month, although the rate of reduction in the level of employment slowed in February.

"China's manufacturing sector scored progress in overall operating conditions in February, with the company's most powerful print output expansion since last summer while the number of new business also rose by a faster rate," said Annabel Fiddes, economist at Markit. "However, the decline in the level of new export orders showed that the level of foreign demand has weakened, while factories continued to cut the number of their employees, even if only slightly.

News and Review of European Economic Zone (UK)

UK Manufacturing Activity Up in February

Monday, March 2nd, 2015

Markit / CIPS UK manufacturing activity index report in February at 54.1 up from 53.1 the previous month and better-than-estimated 53.5 ekeonom. However, the index for export levels recorded decreases, so that the reinforcement is more driven by domestic demand. Figures index in February was also the highest level in seven months.

Said the decline in exports as a result of the strengthening of the pound sterling against the euro around 7% since the beginning of this year. The eurozone is the UK's main export markets.

Markit senior economist Rob Dobson, said manufakur activity reports so far indicate a resurgence in the first quarter of this year, but he also said that the increase in activity manfaktur now more dependent on the production of consumer goods rather than investment in plant and measin, further demonstrating the company's expansion.

In the quarterly index of manufacturing activity showed an increase of about 0.5% at the beginning of this year, compared with 0.2% in the final quarter of 2014.

News and Review of European Economic Zone

Eurozone Unemployment Rate Dropped in January

Monday, March 2nd, 2015

Eurostat reported the unemployment rate in the euro zone amounted to 11.2% in January, down from 11.4% in December. Economists had forecast the unemployment rate will remain at 11.4%. Until January, the unemployment rate in the euro zone has declined in two consecutive months and are at their lowest level since April 2012.

Eurostat Estimates show 18 million people in the euro zone does not have a job, that number dropped as many as 140,000 people from December. More than 3 million unemployed have under 25 years of age, making the youth unemployment rate amounted to 22.9%.

Germany and Austria recorded the lowest unemployment rate below 5%, while the highest was 25% Greece and Spain, followed by 23%. Greece and Spain have youth unemployment of more than 50%