Thailand’s customs trade deficit fell to just $597M in October, thanks to still-helpful seasonal effects...
...This masked an immediate reversal of the unsustainable bounce in exports in September.
Falling imports—in nominal and real terms—likely will drive the “improvement” in the trade balance.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Vietnam’s exports continue to slide, falling well below the trend; no signs of a bounce from imports.
- Ignore double-digit retail sales growth; the level is stagnant and inflation will only worsen.
- Thailand’s final pre-Q3 GDP data dump all but confirms our 4.4% year-over-year forecast.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Thai exports rose in September for the first time in months, but not enough to stop a trade hit to GDP…
- …And in spite of the revival in tourism; we have cut our Q3 GDP forecast to a below-consensus 4.4%.
- The SBV hiked by another 100bp to shore up the VND, compelling us to cut our 2023 GDP forecast.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Thailand’s customs trade deficit continued to widen sharply in August, due to the slump in exports...
- ...But shipments should soon stabilise, and the U-turn in surging imports has only just started.
- The SBV’s unexpected rate hike on Friday was more about exchange rate management than inflation.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- We expect a consensus-beating 18.0% Q3 GDP for Vietnam this week; thank base effects, nothing else.
- The economy is in a broad-based soft patch, and the likely trade lift is due only to collapsing imports.
- The recent relaxation of credit quotas is too late for 2022; the real battle is with the slump in M2 growth
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Indonesia’s trade surplus beat expectations last month, as predicted, but it will start falling soon...
- ...Commodity prices will be net-negative shortly, offset only partially by EU and Chinese demand.
- Expectations for a current account deficit this year still seem off; that’s a mid-2023 story, at the earliest.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- WPI inflation in India continued to slow sharply in August, with outright deflation now on the horizon....
- ...This should build the case for smaller rate hikes, especially with more cracks showing in RBI unity.
- The trade deficit likely has peaked, thanks to falling oil prices, but don’t expect any help from exports.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- CPI inflation in India surprised slightly to the upside in August, refuelling calls for a 50bp rate hike...
- ...But we’re sticking to our 25bp call; the jump in food inflation likely is a one-off, and core is steady.
- The July crash in industrial growth was more than a base effect story, as output clearly is stagnating.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Retail Sales momentum in Indonesia has ebbed recently, following this year's big Ramadam binge...
- …An instant hit from the fuel price hike is no surety;
we’ll take our cues from the impact on confidence.
- The misery in Philippine exports is set to continue,
even if demand from China recovers shortly
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- GDP growth in India disappointed in Q2, jumping merely to 13.5%, despite huge Delta base effects.
- The headline should collapse in Q3, especially with the drag from oil prices persisting until early 2023.
- The road ahead for consumption and investment will be rockier, rising inflation and credit costs aside.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Vietnam’s economy is ebbing in the current quarter, with consumption, specifically, disappointing...
- ...But we still see a consensus-beating 18.0% GDP print for Q3, thanks almost entirely to base effects.
- Inflation unexpectedly slowed in August, but the uptrend is far from over; a Q4 hike remains likely.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
We expect India’s Q2 GDP report tomorrow to beat expectations, with growth surging to over 20%...
...The boost from Delta base effects will be strong, and consumers regained energy, post-Omicron.
The overall q/q profile will be soft, though, due to non-existent new investment and a bigger trade hit.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
