- India’s decent April IP is not without its flaws; growth is now tanking at the margin…
- …This emerging softness is due to falling consumer non-durables, masked by flying capital goods.
- Blame seasonal noise for Thailand’s biggest trade deficit in over two years, but US demand is sliding.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Taiwanese retail sales outright contracted in April, due to a drop in discretionary spending…
- …Consumer confidence surveys are turning sour, which will be bad news for already weak spending.
- Malaysian inflation held steady in April; while low, it could be artificially depressed by price controls.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
Indian services push the Q2 recovery forward in May
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: Back in business; at least 75bp in more cuts to come this year.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Our final forecast for India’s Q1 GDP report sees a dip to 6.0% from 6.2%, below the consensus, 6.7%…
- …The big boost from net trade in Q4 should vanish fully, offset partly by improved local private demand.
- The PMIs suggest the job market is rapidly heating up again, but we still see no hard data confirmation.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: An abysmal start to Q2, but support from energy has been fading for a few months.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Bank Indonesia resumed easing, with a 25bp cut; the Q1 GDP letdown was even graver in actuality.
- The Board’s lower credit growth forecast is already looking too optimistic; we see 75bp more in cuts.
- US and ASEAN front-loading continues to mask weak Chinese demand for Malaysian exports.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- GDP growth in Thailand slipped modestly in Q1, to 3.1% from 3.3%, with exports giving a big cushion…
- …But our global forecasts point to goods export growth slowing below 2% by Q4, from nearly 14%.
- This will increasingly expose headline GDP growth to the broad-based sluggishness domestically.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
Pre-“Liberation Day” anxieties were there for all to see in Thailand’s Q1
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
Don’t panic about the continued ballooning of India’s trade deficit
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- VND underperformance could look bad amid ongoing US trade talks, but the SBV’s hands are tied.
- Talk of a ‘crisis’ in Thai tourism is overblown; yes, Q1 was grim, but other big markets are struggling too.
- Singapore export growth easily beat expectations in April, though underlying trends are softening.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
A larger-than-expected Ramadan bump in Indonesian sales that isn’t expected to last
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: More food disinflation to come in May; the 2025 consensus remains far too high.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Indonesia’s March retail sales report was flattered by Ramadan effects; beware the slide in confidence.
- Malaysian sales were also strong in March, at 6.6% year-over-year, suggesting strong Q1 consumption.
- Indian WPI inflation dropped to a 13-month low in April, thanks in large part to waning food pressures.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Indian inflation dropped to a 69-month low in April; we now see a terminal rate of 5.25% for the RBI.
- Below-average food inflation looks set to stay, with this year’s monsoon season expected to be fruitful.
- Note that CPI has yet to benefit fully from the slump in global oil prices, implying huge downward risk.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
Huge bounce in Philippine imports masks a broad-based Q1 improvement
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- GDP growth in the Philippines inched up in Q1, to 5.4%, but a big import bounce is to blame…
- …Activity broadly improved, especially government spending, though the Q1 bump should be a one-off.
- Consumption should improve this year due to low inflation, while capex still faces many headwinds.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
An overdue—and big—m/m correction in Philippine sales to close Q1
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- ASEAN’s manufacturing PMI plunged to a new post-Covid low in the wake of “Liberation Day”…
- …But it looks like China’s struggles are more pressing, for now, and it’s best to wait for hard IP data.
- We’ve slashed our 2025 average inflation forecast for the Philippines to just 1.8%, from 2.5%.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
Front-loading of Vietnamese exports to the US looks to have hit a ceiling
A quiet start to Q2 for retail sales in Vietnam, following a robust Q1
Lots of moving parts, but April saw no change to Vietnamese inflation
Below-target-range inflation in the Philippines looks set to persist until year-end
This bout of Thai deflation should be short and shallow
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
