India's manufacturing PMI jumps to a 17-year high, but so what?
The rebuild of inflationary pressures in services is becoming harder to ignore
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: Still waiting for the first of a couple green lights.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Bank Indonesia left the BI rate unchanged at 6.00% yesterday, as universally expected.
- Its ongoing insistence on the need to safeguard the IDR is unwarranted; the carry trade has long turned.
- The Board’s thinking on GDP is becoming more muddled; expect to see the first 25bp cut in June.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: A one-off, or is the lumpy slide in non-oil imports finally over?
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
The early 2024 misery in Indonesian exports continues
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
Indonesian retail sales growth remains well below average, despite the January bounce
Upstream core inflation in India is still MIA; great
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Indonesian retail sales growth bounced merely to 1.1% in January, remaining well below par…
- …The passenger-car sales data are even more abysmal, amid a steady deterioration in confidence.
- We reckon Malaysian retail sales growth bottomed out in January and will likely rise from February.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Food inflation in India looks set to remain sticky until mid-year, amid the collapse in farm output growth...
- ...Forcing us to raise our 2024 CPI forecast to 4.6%, and push back the likely first rate cut to August.
- The slowdown in industry is becoming increasingly broad-based and will soon hit GDP growth hard.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: Delaying our first RBI rate cut call to August; industry is floundering, forget the H2 2023 ’strength’ in GDP.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
A decent, if quiet, start to the year for Philippine trade
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- The Philippines’ unemployment rate jumped in Q1, to 4.5%; a smaller labour force is partly to blame.
- Weakness is surfacing, and another minimum wage hike will make matters worse outside the capital.
- The regional reserves rebuild is far from complete; Vietnam's and the Philippines’ lag is the main worry.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
The H2 recovery in Philippine sales is stagnating, at best
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- The BNM opted to hold rates at its March meeting, as inflation remains benign and growth intact.
- It signalled that the MYR is undervalued, but we expect it not to turn to interest rates to address this.
- The slump in Philippine sales is nearly a year old, underscoring the weakness of household budgets.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- ASEAN’s manufacturing PMI hit a six-month high in February, but underlying demand remains poor.
- Price pressures are building at the margins again, though the year-over-year story is still deflationary.
- Vietnam’s impressive export recovery is on track, despite a Tet-induced growth crash in February.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
Thank the labour market for the six-month high in ASEAN’s PMI
Non-core factors lead a February bounce in Indonesian inflation
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- We expect Taiwanese GDP growth to recover this year to 3.4%, after declining to 1.4% in 2023…
- … As the recovery in external demand and tech cycle upswing paper over weaker local demand.
- The CBC is likely to be on hold for all of 2024, even though inflation will probably average less than 2%.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: We repeat; forget the discrepancy-inflated headline, India’s main engine is still stuttering.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: Feel free to continue ignoring the rosy headline.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
Don’t worry about the Tet noise, Vietnam's export recovery remains on track
Reported sales growth continues to tell only a small part of the—weak underlying—story
Noticeable seasonal demand for food and adverse base effects push inflation up to 4%
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- India’s Q4 GDP surprised massively to the upside, with growth rising to 8.4% from 8.1% in Q3...
- ...But statistical discrepancies continue to inflate the headline, hiding the sluggishness in consumption.
- The drag from net trade eased too, but this was all down to an unwelcome quarterly plunge in imports.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
