- Banks are continuing to tighten credit availability for business and consumers.
- The real cost of bank loans to small businesses is approaching 8%; no wonder they are cutting costs.
- The lag between banks' willingness to extend consumer credit and lending flows is long; a slowdown lies ahead.
Ian Shepherdson (Chief Economist, Chairman and Founder)US
- Our final forecast for Thailand’s Q1 GDP sees growth slowing to just 0.7%, from 1.7% in Q4…
- …The slowdown in consumption is the main drag, alongside the fading yearly lift from net trade.
- The six-month bout of CPI deflation ended in April, as food and transport inflation returned to the black.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
The six-month spell of Thai deflation comes to an end
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- April's slowdown in payrolls looks like real weakness; revisions likely will push the numbers down further.
- Near-zero growth in payrolls lies ahead if the NFIB survey retains its status as the best leading indicator.
- The ISM services survey has joined the growing list of surveys showing that labor demand is weakening.
Ian Shepherdson (Chief Economist, Chairman and Founder)US
- In one line: Food inflation finally turns a corner; more of this, please.
Miguel Chanco (Chief EM Asia Economist)Global
- In one line: Export-oriented manufacturers continue to underperform.
Miguel Chanco (Chief EM Asia Economist)Global
Export-oriented ASEAN manufacturers continue to underperform
Food inflation in Indonesia finally turns a corner; more of this, please
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- The turnaround in ASEAN’s manufacturing PMI remains largely intact, despite the April slip…
- …But the region’s more export-oriented countries are still underperforming; orders remain in the red.
- Indonesian inflation saw a positive downside surprise in April, as food inflation turned a corner.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Both the Homebase data and the NFIB survey signal slower job growth in April, but the numbers are noisy.
- One softer print would not trigger a Fed response, but it would make the May number critical for markets.
- The ISM services survey likely will provide further reassurance on the underlying inflation outlook.
Ian Shepherdson (Chief Economist, Chairman and Founder)US
- Chair Powell batted away talk of a further rate hike, and hinted that labor market fears are emerging.
- Everything will change if payroll growth slows sharply; that won't happen overnight, but it is coming.
- Still no signs of a real manufacturing recovery, and inflation risks from the sector are minimal.
Ian Shepherdson (Chief Economist, Chairman and Founder)US
- In one line: Decent, and the drag from refined petroleum products should reverse in the short run.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: Back down to earth, and likely more pain ahead.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
AN—UNWELCOME—FEELING OF DEJA VU FROM BI
- …GDP GROWTH IN DEVELOPED ASEAN PICKS UP IN Q1
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- US - Does Chair Powell still see no signs of cracks in the labor market?
- EUROZONE - Higher GDP won’t impede first rate cut in June, as core inflation falls
- UK- Forecast Review: strong growth and stubborn services
- CHINA+ - BoJ stands fast, refusing to bow to currency-market pressure
- EM ASIA - A strong—but frankly foolish—policy response from BI
- LATAM - Mexico to hold rates amid inflation surprise and economic rebound
Ian Shepherdson (Chief Economist, Chairman and Founder)Global
- The FOMC will likely take a hard line on easing today, despite abundant warnings of a weaker labor market.
- The disappointing Q1 ECI is not definitive; leading indicators signal downward pressure on wage growth.
- Ignore the ADP and JOLTS job openings today; the JOLTS quits rate matters far more.
Ian Shepherdson (Chief Economist, Chairman and Founder)US
- Year-over-year growth in the ECI likely fell below 4% in Q1, almost back to its inflation target-consistent rate.
- California fast food price rises driven by the minimum wage hike will have a microscopic impact on the CPI.
- Ignore the 3.9% Q2 growth forecast from GDPNow; its estimates are often way off this early in the quarter.
Ian Shepherdson (Chief Economist, Chairman and Founder)US
- Thailand’s customs trade balance missed widely in March; the adjusted gap sank to a 19-month low…
- …Export leading indicators remain lacklustre, while import growth is getting a lift from global oil prices.
- Vietnam’s trade surplus collapsed in April; it looks like export growth truly has peaked, for now.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
Downward pressure on the Thai baht continues to intensify
Correction in Vietnamese exports bleeds into Q2
Ignore the headline; retail sales growth in Vietnam is still wobbling
Expect a further leg up in Vietnamese inflation in May, the likely peak
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
