Important developments today:
1. Japan’s unemployment rate inches up in January
Japan’s unemployment rate inches up in January. Japan’s unemployment rate inched up to 4.6% in January from 4.5% the previous month, according to a release by the Internal Affairs Ministry. The rise in unemployment rate mostly reflects an increase in number of previously inactive people resuming job searches rather than increased firing. Indeed, industrial production rose by 2% (m/m) in January and spending on capital goods also grew by 7.6% in Q4 2011. Further, the restoration of supply chains post-Thai floods, and ongoing reconstruction in the Tsunami hit areas is expected to lend support to output and employment growth in the coming months.
Among Emerging Market
In East Asia and the Pacific, Philippines’ central bank cut its benchmark overnight borrowing rate (reverse repurchase rate) by 25 basis points to 4.0% to support weakening domestic demand amid a relatively benign inflation outlook. Inflation is expected to remain within the central bank’s 3-5% target range in 2012-12. Meanwhile, Indonesia’s consumer price inflation slowed to 3.56% (y/y) in February from 3.65% in January, and Thailand’s to 3.35% from 3.38%, both reflecting contained food price pressures.
In Europe and Central Asia, Turkey’s merchandise import grew at a sluggish pace of 2.8% year-on-year (y/y) in January, slowing further from the 4.1% pace recorded in the final two months of 2011 due to a drop in demand from the European Union, Turkey’s largest trading partner.
In South Asia, Pakistan’s consumer price inflation accelerated to a six-month high of 11.1% (y/y) in February from 10.1% in January, led by steep increases in food and transport costs (with fuel price increases reflecting higher international crude oil prices) of 10.6% and 18.8%, respectively.