Daily Market Update – January 08, 2013
- The U.S. might run out of funds to pay all its bills as early as Feb 15 after it exhausts emergency measures undertaken when it hit the $16.4T debt ceiling at the end of last month, the Bipartisan Policy Center said. The U.S. Treasury Department has started using so-called "extraordinary measures" to keep funding the government. Treasury Secretary Timothy F. Geithner said Dec 26 that "under normal circumstances" those safety lines would last for about two months and create about $200B of "headroom." "Based on financial data from Treasury, we estimate that the government will be unable to pay all of its bills as early as Feb 15," Steve Bell, senior director of the economic policy project at the Bipartisan Policy Center, said. "We have less time to solve this problem than many realize"
- The global economy in 2013 will be better than 2012 despite the challenges in the U.S. and the "mess" in Europe, said an economist. "This year will grow faster than 2012. We expect 2.8% global growth this year versus 2.2% achieved last year," Standard Chartered Bank global head of macro research Marios Maratheftis said
- Christmas season sales in the U.K. were as weak as expected, the British Retail Consortium said. BRC's retail sales monitor for Dec showed retail sales values up 0.3% on a like-for-like basis compared to one year ago. The figure was far below the 2.2% Y-o-Y increase seen for Dec 2011. Overall sales were up 1.5% Y-o-Y, vs. a 4.1% increase in Dec 2011
- China's economy has the potential to grow 8% annually over the next 20 years should the nation reduce support for state companies and unshackle banks, according to Lin Yifu, a former World Bank chief economist. "We can be quite optimistic," Lin, who now teaches at Peking University in Beijing, said. To harness its potential, the country needs to widen income distribution and cap "widespread" corruption, he said