Economic Update

The British Bankers' Association reported that the number of mortgage approvals for house purchases in the UK unexpectedly declined to 30,506 in February from 31,983 in January.

The European Central Bank decided to continue providing access to Emergency Liquidity Assistance to banks in Cyprus, as the nation managed to agree on a bailout deal with its international lenders.

A survey from Sentix revealed an increase in the number of eurozone investors believing that the common currency union may disintegrate over the coming twelve months. The Sentix euro break-up index that measures probability of a breakup of the euro area rose to 41.1% from 19.3% in the previous month.

The US Federal Reserve Chairman, Ben Bernanke, stated that the central bank’s monetary easing measures are supporting the recovery in other global economies as well. He further added that low interest rates in advanced nations benefit the world economy while not creating a disruptive diversion of trade through weaker currencies.

The Dallas Federal Reserve Bank reported that on a seasonally adjusted basis its manufacturing business index surged to a reading of 7.40 in March, following a reading of 2.20 recorded in the previous month.

The Chicago Federal Reserve Bank’s national activity index climbed to a reading of 0.44 in February, following a downwardly revised reading of -0.49 posted in January.

The New York Federal Reserve President, William Dudley, stated that the US Federal Reserve must maintain its accommodative stance, as the labour market in the US remains "far from healthy" despite signs of improving economic conditions.

Haruhiko Kuroda, the Governor of the Bank of Japan, has indicated that extending the duration of Japanese government bonds which the central bank buys to five years from the current three years would be one of its policy options to pursue monetary easing. He also indicated that it is difficult to adopt nominal Gross Domestic Product (GDP) as a target for monetary policy.

On an annual basis, the corporate service price index in Japan has risen 0.1% in February, compared to a 0.2% decline reported in January.

New Zealand has surprisingly swung to a merchandise trade surplus of NZD414.00mn in February compared to a revised NZD287.00mn deficit reported in the earlier month.

On a seasonally adjusted quarterly basis, the GDP in South Korea has expanded 0.3% in 4Q12, lower than the preliminary estimate and compared to a 0.1% rise recorded in 3Q12.

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