VENTURE CAPITAL POST

A rift is emerging between Prime Minister Shinzo Abe and his hand-picked central bank boss on how to fix Japan's tattered finances, which could blunt the impact of the "Abenomics" stimulus policies they have worked together to prosecute.

Activity in China's mammoth factory sector edged up to a four-month high in February but export orders shrank at their fastest rate in 20 months, a private survey showed, painting a murky outlook that argues for more policy support.

With shrinking prospects at home and the threat of further yen weakness, Japanese companies are rushing to buy overseas and seem willing to pay top dollar, as shown by Japan Post's $5 billion bid for Australia's Toll Holdings (TOL.AX).

Japan's economy likely rebounded from recession in the final quarter of last year, data on Monday is set to show, giving a much needed boost to premier Shinzo Abe's efforts to steer the country out of decades of stagnation.

The Bank of Japan has put monetary policy on hold and found backing for its wait-and-see stance from advisors to Prime Minister Shinzo Abe, who worry more easing could send the yen to damagingly low levels, according to officials in the administration and central bank.

Tumbling oil prices have strengthened rather than weakened the Federal Reserve's resolve to start raising interest rates around midyear even as volatile markets and a softening U.S. inflation outlook made investors push back the timing of the "liftoff."

The People's Bank of China will continue to maintain "prudent" monetary policy in 2015, keeping credit growth stable while having its hands free to fine-tune policy when necessary, the regulator said in an online statement on Friday.

Bank of Japan Governor Haruhiko Kuroda said the bank has various tools left if it were to ease monetary policy again, stressing its determination to hit its inflation target in the next fiscal year.

China's factory activity sputtered in December, underlining the challenges facing the country's manufacturers as they fight rising costs and softening demand in a cooling economy.

Activity in China's factory sector contracted in December for the first time in seven months, the latest in a string of weak economic indicators that will intensify calls for more stimulus measures to head off a hard landing.

The guessing game over the timing of euro zone money printing will intensify as the European Central Bank unveils a closely watched gauge of policy in the coming week, the highlight of a calendar dominated by Europe's malaise.

U.S. stocks rose on Wednesday, with both the Dow and S&P 500 ending at records, as data pointed to improving conditions in the U.S. services sector, boosting cyclical stocks.

Bank of Japan Governor Haruhiko Kuroda on Tuesday stressed the bank's readiness to expand stimulus further to meet its price goal, standing firm in the face of criticism that last month's monetary easing has accelerated unwelcome falls in the currency.

China's leadership and central bank are ready to cut interest rates again and also loosen lending restrictions, concerned that falling prices could trigger a surge in debt defaults, business failures and job losses, said sources involved in policy-making.

The ECB will not improve the terms of its ultra-cheap long-term loans for now, though this may change if it becomes clear that the euro zone economy is taking another turn for the worse, several sources familiar with the discussion told Reuters.