ASEAN Morning Bytes
Asian markets will likely trend higher as market participants look forward to Biden’s planned fiscal stimulus package.
EM Space: Focus will be on Biden’s stimulus plan and vaccination effort
- General Asia: Asian markets likely to track gains overnight, boosted in large part by hopes for a substantial fiscal stimulus from US president Biden who was sworn in on Wednesday. Investors may also be upbeat with Biden pushing for a more aggressive stance to combat the virus to speed up vaccination by utilizing the defense production act. Meanwhile, Thursday features several central bank decisions (BoJ, ECB and Bank Indonesia) as well as US initial jobless claims and housing starts.
- Indonesia: Bank Indonesia (BI) holds its first policy meeting for the year with the central bank widely expected to keep rates unchanged at 3.75% as IDR came under some depreciation pressure to open the year. BI Governor Warjiyo will likely retain the central bank’s accommodative stance, signalling possible rate action in the near term should the currency stabilize and if inflation remains benign. We expect BI to be open to additional easing in the coming months to help drive the economic recovery, which may fall short of expectations after a spike in virus infections forced Java and Bali to return to stricter partial lockdown measures.
- Philippines: December trade data is scheduled for release Friday with investors expecting exports to nudge higher while imports are forecast to sustain double digit contraction. Exports may post another month of modest expansion, driven in large part by outbound shipments to China but imports will likely contract for a 20th straight month as weak domestic activity saps import demand. The sharp drop off in imports during the ongoing lockdowns have helped pushed the current account into surplus and bolster PHP, with the current expected to enjoy short term appreciation pressure with import demand predicted to remain soft in the coming months.
What to look out for: Central bank meetings and Biden presidency
- Philippines trade (21 January)
- Bank of Japan meeting (21 January)
- ECB policy meeting (21 January)
- US initial jobless claims and housing starts (21 January)
- Bank Indonesia policy meeting (21 January)
- Thailand trade (22 January)
- Malaysia CPI inflation (22 January)
- US existing home sales and PMI manufacturing (22 January)
Download
Download article
21 January 2021
Good MornING Asia - 21 January 2021 This bundle contains 2 Articles"THINK Outside" is a collection of specially commissioned content from third-party sources, such as economic think-tanks and academic institutions, that ING deems reliable and from non-research departments within ING. ING Bank N.V. ("ING") uses these sources to expand the range of opinions you can find on the THINK website. Some of these sources are not the property of or managed by ING, and therefore ING cannot always guarantee the correctness, completeness, actuality and quality of such sources, nor the availability at any given time of the data and information provided, and ING cannot accept any liability in this respect, insofar as this is permissible pursuant to the applicable laws and regulations.
This publication does not necessarily reflect the ING house view. This publication has been prepared solely for information purposes without regard to any particular user's investment objectives, financial situation, or means. The information in the publication is not an investment recommendation and it is not investment, legal or tax advice or an offer or solicitation to purchase or sell any financial instrument. Reasonable care has been taken to ensure that this publication is not untrue or misleading when published, but ING does not represent that it is accurate or complete. ING does not accept any liability for any direct, indirect or consequential loss arising from any use of this publication. Unless otherwise stated, any views, forecasts, or estimates are solely those of the author(s), as of the date of the publication and are subject to change without notice.
The distribution of this publication may be restricted by law or regulation in different jurisdictions and persons into whose possession this publication comes should inform themselves about, and observe, such restrictions.
Copyright and database rights protection exists in this report and it may not be reproduced, distributed or published by any person for any purpose without the prior express consent of ING. All rights are reserved.
ING Bank N.V. is authorised by the Dutch Central Bank and supervised by the European Central Bank (ECB), the Dutch Central Bank (DNB) and the Dutch Authority for the Financial Markets (AFM). ING Bank N.V. is incorporated in the Netherlands (Trade Register no. 33031431 Amsterdam).