Week of June 10, 2012 thru June 16, 2012

China May Trade Beats Expectations On Record Shipment Values


BEIJING (MNI) - China exported and imported record amounts of goods last month, customs said Sunday in a trade report which exceeded admittedly low analyst expectations.

Chinese exports rose 15.3% y/y in May to a record $181.14 billion, outpacing the forecast 6.9% growth, according to the median of an MNI survey, as well as April's +4.9%.

At $162.44 billion, the value of goods imported into China also hit a new monthly record, while the 12.7% y/y increase in inbound shipments was also more than double the +5.0% expected by economists and showed a significant improvement over April's dismal +0.3%.

The result was a trade surplus of $18.7 billion for May, greater than the $17 billion expected.

China Economic Data Calendar


All figures year-over-year percent changes unless otherwise specified.

Date Time For Event Previous Local/GMT

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10-15 Jun -- / -- May Money Supply (M2) (% ytd y/y) +12.8 10-15 Jun -- / -- May New Loans (yuan bln mth, trln ytd) +681.8/+3.14 11-15 Jun -- / -- May Actural FDI ($ bln mth, % ytd y/y) +8.40/-2.4 21 Jun 1030/0230 Jun Flash Purchasing Manager's Index (HSBC) +48.7 22 Jun 0935/0135 Jun MNI China Business Sentiment Flash Survey+52.99 22 Jun 1000/0200 May Conf Brd China Leading Index 232.4 22 Jun 1000/0200 May Conf Brd China Coincident Index 216.0 29 Jun 0935/0135 Jun MNI China Business Sent

US's Geithner: Welcome Spain Action On Bank Sys,Europe Support


WASHINGTON (MNI) - U.S. Treasury Secretary Timothy Geithner Saturday lauded the move by embattled Spain to bolster its struggling financial sector, and said the decision by other eurozone countries to aid the process is a key part of progress towards a financial union.

"We welcome Spain's action to recapitalize its banking system and the commitment by its European partners to provide support," Geithner said in a statement. This followed the announcement by the Eurogroup that a loan of up to E100 billion will be available for Spain's banks.

"These are important for the health of Spain's economy and as concrete steps on the path to financial union, which is vital to the resilience of the euro area," Geithner said.

Europe Aims To Calm Mkts With E100 Bln Pre-Emptive Spain Aid


By Peter Koh

BRUSSELS (MNI) - In a pre-emptive move aimed at calming markets, Eurozone finance ministers on Saturday agreed to set aside up to E100 billion with few strings attached to help Spain recapitalize its troubled banking sector.

The sum of up to E100 billion, which will come from the Eurozone's bailout funds, the European Financial Stability Facility and the European Stability Mechanism, should be enough to cover Spanish banks' capital requirements in their entirety with an additional safety margin, the Eurogroup said in a statement.

The final amount of aid that Spain will ask for will be determined after an independent audit commissioned by Madrid is completed on June 21.

Spain To Seek Bank Aid, Eurogroup To Approve Up To E100 Bln


PARIS (MNI) - Spain will shortly request aid to help recapitalize its banking sector and Eurozone finance ministers are willing to approve a loan of up to E100 billion for that purpose, the Eurogroup said in a statement released Saturday after a teleconference meeting that lasted nearly three hours.

The aid would channeled through Spain's bank restructuring fund, FROB, which would in turn channel it into the banks in need of the assistance. The Spanish government will be responsible for the loans and will sign the agreement under which they are granted, the Eurogroup said.

China Growth Remained Sluggish In May, But No Nasty Surprises


BEIJING (MNI) - Chinese data reports released Saturday contained no nasty surprises, though there was little to celebrate either, with output, investment and retail sales growth in May all indicating that the economy is continuing to grow only sluggishly at best.

Industrial output was up 9.6% y/y in May, slightly better than the previous month's +9.3% disappointment but only just short of expectations for +9.7%, according to the median of survey conducted by MNI.

Fixed-asset investment growth during the first five months of the year was just above expectations at 20.1% versus the 20.0% expected, while retail sales growth of 13.8% in May wasn't far short of the 14.3% expected nor April's +14.1% (they rose 14.5% during the first five months of the year).

China Economic Data Calendar


All figures year-over-year percent changes unless otherwise specified.

Date Time For Event Previous Local/GMT

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10 Jun -- / -- May Trade Balance ($ bln mth, ytd) +18.43/+19.3 10 Jun -- / -- May Exports (% y/y, % ytd y/y) +4.9/+6.9 10 Jun -- / -- May Imports (% y/y, % ytd y/y) +0.3/+5.1 10-15 Jun -- / -- May Money Supply (M2) (% ytd y/y) +12.8 10-15 Jun -- / -- May New Loans (yuan bln mth, trln ytd) +681.8/+3.14 11-15 Jun -- / -- May Actural FDI ($ bln mth, % ytd y/y) +8.40/-2.4 21 Jun 1030/0230 Jun Flash Purchasing Manager's Index (HSBC) +48.7 22 Jun 0935/0135 Jun MNI China Business S

China May CPI Below Forecasts, at 2-Year Low As Econ Slows


BEIJING (MNI) - Chinese consumer price inflation dropped more than expected to its lowest level in nearly two years last month, providing more room for the government to ease policy.

The price index fell to 3.0% year-on-year from April's 3.4%, below economist expectations of a +3.2% print. That marks the lowest since +2.9% in June 2010.

Producer prices also dropped more than expected, with the index dropping to -1.4% y/y last month versus the expected -1.2% and April's -0.7%.

The May price reports highlight the rapid easing of price pressures as the economy slows.

Falling food prices again helped cool overall consumer inflation, dropping back to +6.4% y/y from +7.0% in April.

S&P: Cld Downgrade US By 2014 If Fiscal,Political Risks Build


--Likelihood Could Cut Rating on US Within 2 Years 'At Least' 1-In-3
--Affirms US 'AA+' Credit Rating, Outlook Remains Negative
--Stresses U.S. Needs Credible Medium-Term Fiscal Plan

WASHINGTON (MNI) - Rating agency Standard & Poor's Friday warned that continued fiscal and political risks in the United States could build to a point that it could downgrade the nation's sovereign credit rating within the next two years.

In a statement released after market hours, the firm affirmed its 'AA+' rating on the U.S., citing strengths that include "its resilient economy, its monetary credibility, and the U.S. dollar's status as the world's key reserve currency."

"We believe the Federal Reserve System (the U.S.

US News Events Calendar


--Meetings & Events of Interest to Subscribers

DATE GMT / ET EVENT

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11-Jun 1500/1100 San Francisco Federal Reserve Bank Pres. John Williams delivers brief opening remarks at the Fed bank's Conference on Asian Banking and Finance.

11-Jun 1600/1200 Atlanta Federal Reserve Bank Pres. Dennis Lockhart speaks to the Tennessee Bankers Assoc. annual meeting in Chicago, on the economy and monetary policy, and will answer questions from the audence.