- In one line: Increasingly reassuring trends at the margin.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: The drag from oil prices has run its course.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: Ignore the headline growth rates for December, but Q4 was grim in totality.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
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
- Indonesian export growth fell to a 20-month low of 12.3% in October, and more downside is ahead...
- ...The unwinding of the commodities boom is far from over, and Chinese demand is now softening.
- The rise in India’s trade deficit in October is a minor and brief setback; weak flows are the main issue.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: Just a seasonal jump in the deficit, but two-way trade is falling apart.
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
- In one line: DM demand is stabilising, but Q3 was abysmal for exports.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
The SBV last week widened the dong’s daily trading band to ±5%; it last did so in 2015, to ±3%...
...Vietnam’s healthy trade surplus hid a big BoP shock, and FX reserves now are too low.
The growth outlook for 2023 is worsening; the exchange rate shock is only adding insult to injury.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Export growth in Indonesia slowed sharply to 20% year-over-year in September, a 19-month low...
- ...This slump still has plenty of room to run—well into 2023—as the lift from commodity prices unwinds.
- We reckon the GDP boost from trade continued in Q3; our 7% above-consensus forecast stands.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: The assistance from oil prices is far from over.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Retail sales growth in Indonesia fell in August, but the coming fuel price hit is likely to be trivial.
- The Philippines’ trade deficit continues to feel downward pressure on both sides of the balance.
- Its unemployment rate in August consolidated the fall in July, but note how participation is flying.
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
- In one line: Exports are going from hero to zero in Q3.
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
