ASEAN Morning Bytes
General market tone: Risk-on.
Markets are likely to breathe a sigh of relief on positive news flow from China.
EM Space: Positive news flow from China and elsewhere
- General Asia: Bargain hunting may return today with strong economic data coupled with improving geopolitical developments likely supporting the risk appetite ahead of the US jobs data on Friday conditioning expectations about the Fed policy.
- Philippines: August inflation data is due with consensus expecting inflation to slide below the 2% handle on base effects. Food inflation is expected to weigh heavily on the headline print as rice stocks remain healthy due to new legislation that allows the unimpeded import of the staple. The declining trend in prices will likely give the BSP enough leeway to cut policy rates again at the next September meeting.
- Thailand: The pressure on the authorities to curb the Thai baht appreciation has been rising. Yesterday, the Joint Standing Committee on Commerce, Industry, and Banking urged the Bank of Thailand and the Finance Ministry for additional measures including a withholding tax, promotion of outbound investment, and cutting the bond supply. We expect the BoT to cut the policy rate by another 25bp at the next meeting on 25 September.
- Malaysia: The economy continues to defy the global slump with positive export growth of 1.7% in July and sustained strong trade surplus foreshadowing a steady GDP growth in the second half of 2019. However, external headwinds to growth continue to rise. Yesterday, India raised duty on its refined palm oil imports from Malaysia by 5% to 50%. As such, we believe the Bank Negara will see through the present economic strength and cut rates again, as early as next week.
- Indonesia: Bank Indonesia (BI) remains open to further rate cuts, according to Deputy Governor Budi Waluyo, as they “are aimed at fueling growth” in key sectors of the economy. Waluyo highlighted the ongoing global headwinds as one of the reasons for BI's dovish stance.
What to look out for: US NFP
- Philippines inflation (5 September)
- India current account (5 September)
- US durable goods (5 September)
- Fed Bowman, Kashkari, Evans and Bullard (5 September)
- Hong Kong GIR (6 September)
- Malaysia GIR (6 September)
- Taiwan inflation (6 September)
- US NFP (6 September)
Download
Download article
5 September 2019
Good MornING Asia - 5 September 2019 This bundle contains {bundle_entries}{/bundle_entries} 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).