ASEAN Morning Bytes
General market tone: Wait and see.
Global markets are trained on streaming results for the US elections with oil prices dipping despite recently implemented trade sanctions on Iran
International theme: Markets tiptoe higher but focus still on US elections and European politics
- Results will be trickling in with investors waiting to see the outcome of the US mid-term election, which could have a significant impact on bond yields depending on the composition of the Congress. In Europe, conflicting Brexit reports drove sentiment while anxiety remains elevated regarding the Italian budget.
EM Space: Asian markets may take their cue from the US election results
- General Asia: Market players will remain focused on the outcome of the US mid-term elections with the Fed meeting later in the week. Meanwhile, Asian economies will be set to release foreign exchange reserves numbers later in the session. Were the Asian central banks able to replenish lost reserves after the September swoon?
- Indonesia: Bank Indonesia indicates that it expects growth in 4Q to be flat from 3Q at 5.17% with full-year growth seen to settle within the 5-5.4% target. Furthermore, Deputy Governor Waluyo indicated that future monetary policy decisions will remain data dependent and that government efforts to limit the current account deficit had begun to bear fruit after Indonesia posted its first trade surplus for the year in September of $227m.
- Philippines: CPI inflation remained steady at 6.7% year on year in October on still elevated food price pressures. Prices accelerated by 0.3% versus September, indicating that the “hump-shaped” inflation path would be more drawn out. Given that inflation has not been able to show a substantial deceleration trend, the likelihood of that “moderate” rate hike at the 15 November meeting has increased. The Peso should continue to benefit from structural as well as capital flows in the coming week, which the BSP maintained its hawkish bias of late.
- Philippines: Efforts to augment the supply of all-important rice stocks hit a snag with the government announcing that it failed to secure bids for a tender to import 203,000 MT of rice, which could keep rice prices elevated going into the holiday season. The government had allotted 750,000 MT for rice imports before December but only 47,000 have been procured to date. This could keep the deceleration in overall inflation much slower as rice accounts for roughly 9% of the CPI basket.
- Thailand: In a second consecutive slide, the University of the Thai Chamber of Commerce’s Consumer Confidence Index fell further to 81.3 in October from 82.3 in the previous month. Data signals a weakening private consumption support to GDP growth coming into the final quarter of the year. More reasons for the central bank to maintain the current policy stance at the upcoming meeting on 14 November, and beyond.
What to look out for: China trade data, FOMC meeting
- PH trade (7 November)
- ID GIR (7 November)
- PH GIR (7 November)
- CH GIR (7 November)
- PH 3Q GDP (8 November)
- CH trade (8 November)
- US FOMC (9 November)
- US consumer sentiment (9 November)
Download
Download article
7 November 2018
Good MornING Asia - 7 November 2018 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).