China shifts gears from inflation to growth

NEW YORK (CNNMoney) -- Taming rapidly rising prices is so 2011.
In the new year ahead, China's top leaders will focus instead on slowly revving up the world's second largest economy.
At least, that's the message economists glean from reading in between the lines of an official government release Wednesday. Chinese leaders met behind closed doors for three days this week, to hash out their economic strategy for 2012 at their Central Economic Work Conference.

The end result was a lengthy concluding statement, diagnosing the outlook for the world economy as "extremely grim and complicated" and focusing a lot more on stabilizing China's growth, rather than last year's number one priority: curbing inflation.

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Federal Reserve, keeps monetary policy on ice

NEW YORK (CNNMoney) -- The Federal Reserve acknowledged the job market has improved slightly, but said the economy's immediate future remains on pins and needles.

"The economy has been expanding moderately," and "indicators point to some improvement in overall labor market conditions, the Fed said in a statement Tuesday.

But the Fed was quick to follow up that good note with a side of pessimism: "the unemployment rate remains elevated" and "strains in global financial markets continue to pose significant downside risks."
The Fed's policymaking committee, the Federal Open Market Committee, voted 9-to-1 to make no changes to the central bank's ongoing stimulus policies and renewed its pledge to keep interest rates at record lows "at least through mid-2013."

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Euro drops, below key $1.30 mark

NEW YORK (CNNMoney) -- The euro fell to its lowest level since mid-January, easing below the key $1.30 mark Wednesday, as any enthusiasm over Europe's most recent "solution" has cooled.

"This has been a difficult trading year," said Brown Brothers Harriman currency strategist Marc Chandler. "There's more room to the downside."

The euro was trading at $1.2975 and Chandler said next year, it could go below $1.25. It hasn't traded this low since Jan. 11, when Japan pledged to buy eurozone bonds in an effort to stop the debt crisis from spreading.

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Existing home, sales to be revised lower

NEW YORK (CNNMoney) -- If you thought the U.S. housing market couldn't get much worse, think again.

Far fewer homes have been sold over the past five years than previously estimated, the National Association of Realtors said Tuesday.

NAR said it plans to downwardly revise sales of previously-owned homes going back to 2007 during the release of its next existing home sales report on Dec. 21.

NAR's existing home sales numbers, released monthly, are a closely followed gauge of the health of the housing market.

While NAR hasn't revealed exactly how big the revision to home sales will be, the agency's chief economist Lawrence Yun said the decrease will be "meaningful."

"For the real estate business, this means the housing market's downturn was deeper than what was initially thought," Yun said.

Yun said the database NAR uses to track existing home sales, the Multiple Listing Service (MLS), has led the real estate agency to over-count existing home sales for several reasons.

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Stocks sink, investors wait for vote in Europe By Roland Jones

Wall Street sank at the start of trading Tuesday as investors waited for the results of a key vote by Slovakia on a plan to expand the euro zone rescue fund.
All the other member states have ratified a plan to increase the size and powers of the European Financial Stability Facility bailout fund. Now all that remains is for Slovakia to have its say on the matter.

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Indonesia - Unexpectedly Cuts Benchmark Interest Rate to Bolster Expansion

Indonesia’s central bank unexpectedly cut its benchmark interest rate for the first time in more than two years to spur growth as the global recovery weakens and inflation slows.

Bank Indonesia lowered the reference rate by a quarter of a percentage point to 6.5 percent, Governor Darmin Nasution said in Jakarta today. All of the 15 economists surveyed by Bloomberg News expected no change.

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Indonesia, Malaysia, Philippines, Southeast’s Asia Fiscal Stimulus

Indonesia joins Malaysia and the Philippines in stepping up efforts to shield growth from the global slowdown.
Philippine President Benigno Aquino approved a fiscal stimulus package yesterday, while Malaysian Prime Minister Najib Razak announced in the country’s annual budget last week that he will distribute cash to low-income families, raise wages for civil servants and boost spending on transportation.

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