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Investors Please Be There Restrictions Oil Production

Friday, January 16, 2015

Oil trade looks verdant Friday as investors hope will be a tightening of production that can withstand the fall of oil prices. James Hubbard, head of oil and gas research at Macquarie Group, said prices below $ 40 a barrel will make it difficult for producers to cover production costs. This will force the oil producers to begin to restrict production. If the price is below $ 40 per barrel, about 1.5 million barrels per day of oil supply will create cash flow becomes negative and when the oil producers began to lose money, they will begin to limit production.

Oil companies have started to reduce spending and cancel large projects. This budget adjustment will be more obvious when corporate earnings announcements soon.

Oil for February delivery traded at around $ 47.02 a barrel on Friday afternoon, with daily lows $ 45.93 per barrel and daily highs $ 47.09 per barrel.

News and Economic Review Zone Asia (Japan)

Saving Abenomics Listed Company

Friday, January 16, 2015

Teikoku Data Bank reported for the first time in 24 years, the company listed in the Japanese stock market in 2014 there were bankrupt. This data gives the sense that the efforts of Japanese Prime Minister Shinzo Abe to lift the economy, otherwise known Abenomics, successfully helping companies listed.

"Arrow" The first of the three-business Abenomicss program, monetary stimulus, increasing the monetary base is between 60 to 70 trillion yen per year. In October last year, it raised its monetary stimulus to 80 trillion yen and this effort was seen to fruition.

"Help with this large amount widen the monetary base as well as encourage banks to extend loans to small listed companies in difficulty '" said Takuya Ishida, an analyst Teikoku Data Bank. In addition to excess funds in banks that are ready to support small companies, the government also continued regulation in 2008 that directs banks to roll over loans to small businesses and medium businesses

News and Review of European Economic Zone (Switzerland)

SNB Intervention Fall USDCHF

Friday, January 16, 2015

The exchange rate USDCHF managed to bounce from 0.7785 low to the 0.8896 level so far due to the intervention of the Swiss central bank (SNB) to provide liquidity as a result of investor panic after the SNB step startling disconnect EURCHF peg value.

While EURCHF also rose sharply from 0.8500 lows after the announcement of the SNB to the level of 1.0409 so far due to the liquidity provision SNB intervention. SNB subsequent action to direct interventions have reduced the weakening of the Euro against the Swiss Franc.

The response of the observer is quite diverse, such as businessmen luxury watches Swatch Hayek stated SNB steps to dispose of the value of the stakes will cause a tsunami to exporters and Swiss tourism. Without the ceiling value, perhaps the Swiss economy has slumped in the recession phase.

Since 2012, the SNB has spent 188 billion francs or the equivalent of $ 206 billion to intervene by buying foreign currency demo maintain the value of the ceiling. Overall the SNB has had foreign currency worth 432.4 billion francs by the end of September 2014. This figure is certainly quite fantastic and is equivalent to the annual economic output of Switzerland for 3 quarters.

The situation needs a fairly large SNB intervention is consequently sniff by economists some time ago, that in the end the SNB will release the value of the stakes. On release Bloomberg survey conducted on October 4 to October 9 shows the results of a survey of nine economists that the peg will be released in Q4 2014 fastest. 4 While economists expect the release of the ceiling value in 2015, while four other economists predict in 2016.

News and Review of European Economic Zone (Germany)

Inflation Germany 5-Year Low

Friday, January 16, 2015

German inflation declined in December, reaching its lowest level since October 2009. The sharp decline in prices in Germany, the largest economy in Europe, supporting market expectations that the European Central Bank (ECB) will announce the purchase of government bonds in large quantities during the meeting on 22 January, to avoid deflation.

Germany's annual inflation, measured by EU standards, was 0.1% in December, while prices increased 0.1% in the same month. Consumer prices, as measured by national standards, also in accordance with previous predictions. Monthly CPI unchanged, 0.0% remained the same as the previous month, while the annual CPI rose 0.2%.

News and Review of European Economic Zone

ECB Coeure: To be effective, QE Must In Bulk

Friday, January 16, 2015

Quantitaive easing program of the ECB should be able to large quantities to be effective, according to members of the Executive Board of the European Central Bank, Benoit Coeure on Friday in an interview with the newspaper. "To QE can be effective, it must be in large numbers," said Coeure the Irish Times newspaper. "How big is a sufficient amount? This should be informed decisions based on what is known as a transmission line."

Commenting on the ECB's willingness to accept collateral from Greece with the operation of the funding, he said: "We have a rule that the guarantee of an acceptable state under the operation of monetary policy if sufficient credit rating, or if not the country is under the program EU / IMF . "The ECB will soon announce a new scheme to buy euro zone government bonds, known as quantitative easing, possibility as soon as next week, to overcome deflation and return the economy to a strong position

Inventories Rise, Oil WTI Back Depressed

Thursday, January 15th, 2015

WTI crude oil back under pressure after US oil inventories rose last week reported. The oil in early US session had strengthened now seen moving flats, traded at around $ 46.09 a barrel at 22:54 pm, with daily highs and lows $ 46.71 $ 44.99

Energy Information Administration reported that US crude oil inventories rose 5.4 million barrels in the week ended January 9th. Gasoline inventories rose 3.2 million barrels reported, and oil distillation increased 2.9 million barrels. Analysts surveyed by Platts had forecast crude oil inventories fell by 400,000 barrels, while gasoline and distillate oil is expected to rise each of 2.7 million barrels, and 1.9 million barrels.

The abundance of oil supplies, is inversely proportional to the weakening world economy make oil outlook is still bleak. Since last June, WTI crude oil prices have dropped 60%

News and Economic Review Zone Asia (South Korea)

The Bank of Korea Lower Target Economy 2015

Thursday, January 15th, 2015

Bank of Korea (BOK) today lowered its economic growth and domestic inflation for 2015. The low volume of domestic demand is the reason behind the revision of the economy.

Economic growth forecast gross domestic product equivalent value derived by South Korea's central bank from 3.9% to 3.4%. The announcement was published shortly after the BOK hold the benchmark interest rate at the level of 2% for the third consecutive month in last meeting.

"For the last quarter of 2014, the economy is expected to grow 0.4% compared to the previous quarter, well below the initial target of 1%," said BOK Gov. Lee Ju-Yeol. The decline in oil prices experienced by the company management of oil and gas and chemicals to be one source of economic decline in late 2014. These facts make Korea's economic growth for the full year (2014) predicted only at 3.4% or lower than the original target, 3, 5%.

Authorities believe the fundamental situation is not going to improve in 2015 to a revised target of growth required. The low purchasing power of consumers claimed to be 'weak point' in the domestic economy ginseng for the next few months. BOK estimate the level of consumer prices rose only 1.9% this year, well below the previous prediction of 2.4%. The average rate of inflation for 2014 and only 1.3% or lower than the central bank's target in the range of -3.5% to 2.5%.

News and Review of European Economic Zone

Euro Zone Trade Balance Surplus Landscape

Thursday, January 15th, 2015

The increase in exports made surpuls euro zone trade balance widened in November. The rise in exports is also an indication of the weakening of the euro exchange rate can boost economic growth is moderate.

EU statistical bureau Eurostat, reported a trade surplus of € 20 billion in the month Nocember, from € 16.5 billion in the same period in 2013. The reported exports rose 0.2% from October, while the level of imports has not changed. But the level of eurozone exports quite volatile in recent months, after jumping sharply in September, then recorded a slight decline in October.

The data into another positive data after the previous Eurostat reported eurozone industrial production rose 3 consecutive months in November, and retail sales rose two consecutive months in November.

News and Review of European Economic Zone (Switzerland)

Swiss National Bank (SNB) Remove the value of the franc peg

Thursday, January 15th, 2015

Switzerland's central bank surprisingly on Thursday announced to remove the ceiling value of the exchange rate EURCHF at 1.2000 and raise the fees that banks are subject to the deposit in that currency. Also cut its benchmark interest rate 50 basis points.

The SNB said it would cut its target range of 3-month Libor to -1.25% to -0.25% from -0.75% to + 0:25% which will be effective immediately.

EURCHF minimum exchange rate which was introduced in September 2011 to overcome deflation taken to address the risk of deflation as well as provide relief for exporters. But Since its removable bottom peg the value of the Swiss franc, the currency rose sharply break below parity with the Euro currency followed by.

News and Review of European Economic Zone (UK)

UK House Prices Growth Slows

Thursday, January 15th, 2015

UK house prices rose by an annual rate of the slowest since May 2013 at the end of last year, as tightening lending rules and the approach of elections reduce the level of demand, according to one industry body on Thursday. Royal Institution of Chartered Surveyors (RICS) said its monthly house price index fell to +11 in December from +13 in the previous month. The index is an assessment of whether house prices have been going up or down on an annual basis during the previous 3 months.

UK housing sector market has slowed since mid-2014, when the government requires banks to tighten checks whether consumers can bear the mortgage if interest rates rose sharply. Halifax said last week that house prices in the fourth quarter of 2014 rose as much as 7.8% to an annual rate, down from a high level of 10.2% in July. RICS said as tightening lending rules, the election on May 7 will also make buyers and sellers think twice.

Excess Supply of Oil Will Persists

Wednesday, January 14th, 2015

Excess global oil supply is expected to last until at least the second half when demand recovered, according to the Kuwaiti Oil Minister at the same time the leadership of the Organization of Petroleum Exporting Countries (OPEC) United Arab Emirates, Ali Al-Omar. This recovery requires global economic growth faster so it can help absorb excess oil estimated at 1.8 million barrels per day.

Oil prices fell by about 40% since OPEC maintain production targets at a meeting on November 27 in order to maintain their market share.

Until this afternoon oil traded at around $ 45.22 per barrel, lower than Tuesday's closing price of $ 46.11 per barrel.

News and Economic Review Zone Asia (Japan)

Japanese Cabinet Approves Budget 24-year record high

Wednesday, January 14th, 2015

Shinzo Abe Cabinet approved a budget of 96.34 trillion yen for the fiscal year starting April 1 in order to foster economic growth and fiscal improvement Japan. The draft is now awaiting approval from Parliament in the spring, an increase from the initial budget plan amounted to 95.88 trillion yen.

The existence of the projected increase in tax revenue 54.53 trillion yen, a 24-year record high, Japan aids trim new bond issuance amounted to 36.86 trillion yen. Budget approval is expected to help restore the economy and to improve the country's fiscal condition with the highest debt in the world

News and Review of European Economic Zone

Euro Zone Industrial Production Up 3 Months streak

Wednesday, January 14th, 2015

Eurozone industrial production rose 3 consecutive month in November, giving an indication of the economic bloc of 19 countries that continued growth in the final quarter of 2014 as a moderate.

As in October, driven by a rise in the production of consumer goods, which is an indication of a decline in oil prices could increase domestic demand for goods and services.

European Bureau of Statistics, Eurostat, reported that industrial production consists of manufacturing production, mining, and utilities rose 0.2% in November from the previous month, but recorded a decrease of 0.4% when compared to production in November 2013. Eurostat also revised production Okober month to 0.3% from 0.1% the previous release.

Eurostat also reported last week the euro zone retail sales rose two consecutive months in November by 0.6%. The increase was supported by higher sales of goods other than food and gasoline

News and Review of European Economic Zone (France)

the Inflation of France Fall Following CPI report

Wednesday, January 14th, 2015

French inflation fell to a 5-year, adding pressure on the European Central Bank (ECB) to take steps to avoid the risk of deflation and spur growth. Consumer Price Index (CPI) France only rose slightly in December, when seasonal price increases in the tourism sector. French monthly CPI rose 0.1% to an annual inflation rose only 0.1% French, the lowest level since October 2009. Previously, a survey of analysts by Reuters projecting no change either in the monthly and annual indexes.

While price stability Euro area, the Harmonised Index of Consumer Prices (HICP), rose 0.1% in December. However, the data released by the European Central Bank is lower than the 0.4% rise in the previous month

News and Review of European Economic Zone

EU Eases Pressure Related Policies Budget Deficit

Wednesday, January 14th, 2015

The European Union will alleviate the stress associated with cutting the budget deficit to its member countries. This relief is expected to help the French, Italian, and other Member States in adjusting their financial administration with EU rules.

The European Commission, the executive body of the European Union to the national budget, Tuesday announced a new policy to assist the implementation of the budget rules the block, which maintains the budget deficit below 3% of annual gross domestic product. EU countries over the past five years trying to cut the budget deficit swelled due to the economic crisis, tax increases and spending cuts that have hindered the growth and increase the number of unemployed 28-nation bloc by this member.

European Commission Vice President, Valdis Dombrovkis, confirms this budget rule is "landasaan European economic management." If the member states adopted the "structural reforms", such as changes in labor rules, they can avoid a deficit reduction that has been agreed upon before this. This relief will help the French government had asked the commission to run a higher deficit than had been agreed. Similarly, the Italian who has a debt ratio of 130% of its GDP

Oil Closed At Lowest Level Since April 2009

Tuesday, January 13th, 2015

Crude oil prices slumped about 5%, and closed not far from the 6-year lows, after Goldman Sachs cut its forecasts for this year while the price of Gulf producers did not show signs of limiting output.

Analysts Goldman Sachs cut its forecast for US WTI oil price becomes $ 47.15 per barrel from $ 73.75 a barrel earlier.

Venezuelan President Nicolas Maduro on Sunday met with the Crown Prince of Saudi Arabia, as part of a diplomatic tour in the Gulf to discuss the decline in oil prices. Saudi Arabia has so far still maintain their commitment not to reduce production to boost oil prices, and ignored calls smaller OPEC members, including Venezuela.

News and Economic Review Zone Asia (Japan)

Japan Service Sector Sentiment Index Rises

Tuesday, January 13th, 2015

Cabinet Office survey reported the Japanese service sector sentiment index rose to 45.2 in December.

The survey was conducted on workers such as taxi drivers, hotel workers and restaurant staff, otherwise known as "economists" because of their proximity to consumer and retail trends. This increase shows the confidence of Japan will be their current economic conditions which climbed from 41.5 in November.

Data in the form of a comparison with the previous conditions is collected Cabinet Office since August 2001

News and Review of European Economic Zone (Italy)

Italian Industrial Output Rise in November

Tuesday, January 13th, 2015

Italian industrial output recorded the largest increase since June, gave the signal recovery third largest economy in the euro zone. Istat reported industrial output rose 0.3% in November from the previous month, better than the 0.1% rise eskpektasi by economists. As for October output was revised to 0% -0.1% of the previous release. The increase is said to be triggered by an increase in consumer goods by 1.8%, and intermediate goods rose 0.8%.

"This is an early sign of recovery, but it is too early to say this is the beginning of a positive trend" Istat official said.

The Italian government under Prime Minister Matteo Renzi expects the economy will contract in three consecutive years in 2014, and expects to grow moderately this year.

News and Review of European Economic Zone (UK)

Record UK Inflation Lowest In 15 Years

Tuesday, January 13th, 2015

UK inflation growth again recorded a decline in December, and be the lowest in almost 15 years. Low inflation will force the Bank of England Governor, Mark Carney, to create an open letter to explain why inflation is very low growth.

Office for National Statistics reported annual inflation grew 0.5% in December, from 1.0% the previous month, and below economists' estimates of 0.7%. Inflation growth in December was the lowest since May 2000.

A drop in oil prices as well as the supermarket price war in the cause of low inflation. The data from the ONS showed food prices fell 1.9%, while gasoline prices dropped 18% from its peak in 2012. With inflation further away from the target of 2.0% BOE, and the weakness of the euro zone economy to help Carney and the majority of members of the Monetary Policy Committee to maintain interest rates at a record low of 0.5%

News and Review of European Economic Zone

ECB Coeure: Greek elections Not Change Line ECB Policy

Tuesday, January 13th, 2015

General election in Greece on January 25 will not affect the policy of the European Central Bank's path as the ECB considers to launch a government bond purchase plan at a meeting three days earlier, according to one senior ECB. Angora ECB Executive Board Benoit Coeure Jerma told the daily newspaper Die Welt that the central bank is ready to take a decision on whether to launch a new bond purchase plan at a meeting on January 22, but that does not mean it's for sure.

"Elections in Greece did not change the path of monetary policy," said Coeure in the newspaper. "We are in any situation are ready to take a decision on 22 January. It does not mean that we actually have to decide," he added.

Oil Continue Decline In Early Asian Session

Monday, January 12th, 2015

Oil dropped increasingly deeper than the lowest level in more than 5-1 / 2 years as Venezuela and Irlan proposed that members of the Organization of Petroleum Exporting Countries to work together to help the recovery of the crude oil market. Meanwhile Iraq, OPEC's second largest oil producer, to raise prices for Basrah Light Crude oil shipments in February to Asia as much as 30 cents per barrel, after Saudi Arabia also raise his prices. Iraq set the rebate be $ 3.70 per barrel for the average oil price of Oman and Dubai, according to the Oil Marketing Co. This announcement follows last week's price increases by Saudi Arabia, OPEC's largest producer, the price of oil to Asia. Iran in February to raise the price of oil to Asia three days ago.

"This is in line with the Saudi move," said Robin Mills, head of consulting at Manaar Energy in Dubai. "Saudi Arabia is always a trend-setter, and everyone should remember that."

News and Economic Review Zone Asia (Japan)

Japanese Government Estimate GDP Grew 1.5% in Fiscal Year 2015

Monday, January 12th, 2015

The Japanese government expects the economy to grow by 1.5% in fiscal year 2015 after adjustments for price movements, revised up slightly from the previous forecast, due to increases beyond the estimates on consumer spending. The Japanese government estimates the rate of consumer inflation to rise by only 1.4% in fiscal year 2015, signaling the difficulties faced by the Bank of Japan in achieving the inflation target of 2%. Cabinet of Prime Minister Shinzo Abe will use these projections as fiscal and economic policy guidelines as the government tried to encourage the growth of post-shock recession last year.

The previous government estimates that the real economy will grow by 1.4% in the fiscal year that began in March, but the projection is raised after the delay before sales tax increase scheduled in October. Economic growth is also expected to remain strong in the year 2015 in line diskal wage increase and decrease in oil prices sustain corporate profits and consumer spending, according to the Cabinet Office. The Japanese government expects the economy to grow by 2.7% in fiscal year 2015, were slightly below previous expectations of 2.8% growth sebeasr, projections approved by the cabinet on Monday.

News and Review of European Economic Zone (Greece)

European Financial Institutions Getting Ahead of Greek Election

Monday, January 12th, 2015

Banks and financial institutions in Europe to prepare ahead of Greek elections later this month, will be related to a possible Greek exit from the euro. This preparation includes a detailed examination of the parties will have a significant impact with a Greek exit, see the credit exposure or the amount of the loan at the time of default, and examine how they will provide cross-country funding for local operation. Some companies are also preparing for the impact on the system of payments and trade-rate experiment with the platform to see how the effects of the addition of the Greek exchange or trading with potential capital flow control. Corporate giants Citigroup Inc., Goldman Sachs Group Inc., and brokerage firm ICAP including from several institutions that reportedly do this preparation.

Most analysts see a possible Greek exit is quite low. Economists Commberzbank stated odds Greece out of the euro is less than 25%

News and Review of European Economic Zone

Middle ECB QE Setting Program Worth $ 593 Billion

Monday, January 12th, 2015

The European Central Bank is said to have discussed the quantitative easing program worth about € 500 billion ($ 593 billion), according to a statement from the resource persons in the central bank on Friday. Although no decision has been generated, the program will likely include the purchase of sovereign bonds that have investment-grade 'BBB-' / 'Baa3 "or higher.

The news comes following the global market rally on Thursday, after ECB President Mario Draghi reiterated that the central bank is open to sovereign bond buying program. A policy options that could potentially be announced in the next ECB policy meeting on 22 January.

Purchase only includes investment-grade bonds, and not speculative-grade, also will reduce the risk to the ECB balance sheet. By doing so, the government bonds of Greece and Cyprus which has a rating of 'junk' will not be included in the central bank's purchase program.

News and Review of European Economic Zone

Deflation Risk Alert, Visco Urges ECB Quantitative Easing

Monday, January 12th, 2015

The risk of deflation in the euro zone can not be underestimated and the best way for the European Central Bank (ECB) to deal with the problem is with the purchase of government bonds, according to the Italian central bank governor said on Sunday. Ignazio Visco, which is one of the ECB's policy council, issued the comment as officials consider the ECB to print money in order to buy government bonds, known as quantitative easing - to prevent the euro zone falling into deflation. "I can only warn against underestimating the macroeconomic risk of low inflation rates," said Visco the German newspaper, Welt am Sonntag. "If inflation is at very low levels for too long and difficult to grow the economy, we are at risk of falling into a spiral that will become increasingly intense in itself, it is what we call deflation," he said.

Eurozone inflation rate fell to negative territory in December for the first time since 2009, with low oil prices triggered a decline greater than expected. "No doubt, low oil prices help the economy. On the other hand it also triggered the decline in prices. And it is a problem when inflation is already close to zero," Visco said, adding that there is a risk of inflation expectations will fall deeper . "In a situation like this, the most effective way is to buy government bonds," he said. "We are discussing various options on the Policy Board of the ECB, also purchase other bonds such as corporate bonds. But the market is not very big."