Indonesia: MPC Preview: Bank Indonesia to Hold Rate Despite Currency Volatility

April 23, 2024 11:12 AM UTC

With inflation within target range and the need to defend the currency amid global uncertainties and US dollar strength, Bank Indonesia (BI) is likely to extend its pause on rate adjustments in the upcoming monetary policy meeting on April 24. BI remains committed to stabilising the Indonesian rupia

Indonesian Court Delivers Verdict: Prabowo prevails

April 22, 2024 3:18 PM UTC

The Constitutional Court dismissed cases against Vice President Gibran Rakabuming Raka and President Joko Widodo. In Gibran's case, the court didn't disqualify him from running for president but sanctioned the election committee for not amending regulations following a previous ruling. This ruling l

The Pulse of the Nation: Insights into India's 2024 Election

April 22, 2024 7:54 AM UTC

As India braces itself for the upcoming elections, the political landscape is rife with anticipation, strategy, and uncertainty. With the ruling Bharatiya Janata Party (BJP) seeking to consolidate its power and a diverse coalition of opposition forces vying for a chance to unseat them, the stage is

Asia Country Risk Ratings

April 17, 2024 3:00 PM UTC

We provide country risk reviews for Asia countries including China, India, Indonesia, Malaysia, Philippines, Thailand and Taiwan.  

Markets: Fed Rather Than Middle East Worries

April 17, 2024 12:34 PM UTC

Global markets are being driven by a scale back in Fed easing expectations and we see a 5-10% U.S. equity market correction being underway.  However, with the market now only discounting one 25bps Fed cut in 2024, any downside surprises on U.S. growth or better controlled monthly inflation numbers

India Inflation: Risks Tilted to the Upside

April 15, 2024 12:35 PM UTC

India's inflation trajectory in March 2024 showcased divergent trends in both consumer and wholesale price indices. While consumer inflation dipped to its lowest in ten months at 4.9% y/y, wholesale inflation rose to 0.5% y/y, driven by surging food prices. The outlook suggests gradual WPI escalatio

RBI Holds Rates Firm, Citing Room for Economic Growth

April 11, 2024 5:44 AM UTC

In line with our expectations, the Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) chose to maintain the policy repo rate at 6.5% in its latest meeting. The decision reflects their aim to gradually scale back stimulus measures while still supporting economic growth. It also unders

RBI to stand pat in April

April 4, 2024 7:25 AM UTC

The Reserve Bank of India (RBI) is gearing up to announce its first monetary policy decision for FY25 (April-March) on April 5. For the upcoming meeting, we anticipate that the RBI will likely keep the repo rate unchanged at 6.5%, given the optimistic outlook for economic growth and still elevated i

March Outlook: Europe in Focus, Then Elections Around the World

April 3, 2024 9:00 AM UTC

Asset Allocation: Pausing for Breath

April 2, 2024 9:00 AM UTC

Into Q2, data and policy (actual and perceived) will dominate DM markets. The ECB will likely take the spotlight with a 25bps cut on June 7, as the Fed face a better growth/more fiscal policy expansion and a tighter labor market than the EZ but also with a better productivity backdrop and outlook to

Indonesia CPI Review: Ramadan Demand Drives Up Inflation

April 1, 2024 1:33 PM UTC

Indonesia's latest Consumer Price Index (CPI) data has revealed a notable acceleration in inflation, surpassing expectations and marking the highest rate since August 2023. The surge, driven primarily by heightened demand during the fasting month of Ramadan, highlights significant price pressures ac

March Outlook: Europe in Focus, Then Elections Around the World

March 27, 2024 9:00 AM UTC

Outlook Overview: Europe in Focus, Then Elections Around the World

March 25, 2024 11:15 AM UTC

Asia/Pacific (ex-China/Japan) Outlook: Election Spending to Drive Growth

March 22, 2024 12:18 PM UTC

·       In 2024, growth trends across emerging Asia will exhibit a mixed pattern. Encouragingly, there will be a resurgence in demand for global electronics following a period of stagnation in 2022‑23, which will provide a boost to regional trade. Moreover, the initiation of monetary policy

China Outlook: The Struggle to Hit 5% Growth

March 20, 2024 11:00 AM UTC

China’s 5% growth target will likely be tough to meet with residential property investment likely to knock 1.0-1.5% off GDP and net exports a small negative. With sluggish private investment, this means some of the old engines of growth are not firing.  Some additional fiscal stimulus will likely

Bank Indonesia to Retain Policy Rate

March 18, 2024 5:40 AM UTC

Bank Indonesia (BI) will likely maintain the key 7-day reverse repo rate unchanged in March at 6%, in line with recent trends. The stability of the rupiah remains a crucial consideration for BI, alongside CPI inflation, which has moderated within the new target band of 2.5+/-1%. 

Elections to Keep Asia in Limelight in 2024

March 11, 2024 9:05 AM UTC

2024 is turning out to be a significant year for the Asian political scene. At the start of the year, eight countries were scheduled to hold elections this year, with close to 2.2bn people voting this year across emerging Asian economies. 
With elections now over in four of the eight countries, the

India's Q3 GDP: Strong But Uneven Growth

March 8, 2024 2:30 PM UTC

India's economic landscape witnessed a remarkable upswing in Q3-FY24, with a real GDP growth rate of 8.4%,  surpassing both street estimates and the Reserve Bank of India's (RBI) projections. This surge not only solidifies India's position as the fastest-growing major economy globally but also unde

Bank Indonesia to Look Beyond Recent Uptick in Consumer Price Index

March 7, 2024 4:06 AM UTC

Indonesia's Consumer Price Index (CPI) data released by the Central Statistics Agency (BPS) indicates a notable uptick in inflation, reaching 2.75% y/y in February compared to 2.57% y/y in January. The three-month high inflation rate was primarily propelled by surging food prices, aligning with expe

Asia Country Risk Ratings

March 6, 2024 11:00 AM UTC

We provide country risk reviews for Asia countries including China, Malaysia, Philippines and Taiwan.  

Indonesia Preview: CPI to remain broadly stable

February 28, 2024 3:29 PM UTC

Indonesia’s February inflation is likely to remain broadly stable. Food prices will maintain upward pressures but a tight monetary stance will keep headline inflation in check. Increased demand ahead of Ramadan could see prices spike in March. 

India Elections: Political Manoeuvres Unfold

February 28, 2024 9:00 AM UTC

The Rajya Sabha (upper house) elections in India saw a mix of strategic moves, unexpected contests and the assertion of political dominance. While 41 out of 56 leaders secured their seats unopposed, the remaining 15 seats, distributed across the states of Uttar Pradesh, Himachal Pradesh and Karnatak

Farmers March to Delhi as Government Proposal Rejected Amid Election Tensions

February 26, 2024 7:35 AM UTC

In India, widespread farmer protests persist, demanding Minimum Support Prices (MSP) for all commodities, pensions and debt forgiveness. Despite multiple negotiations, the recent central government proposal to purchase specific crops at MSP for five years was vehemently rejected by protesters, promp

RBI Minutes Reveal a Cautious Committee

February 23, 2024 10:42 AM UTC

The Reserve Bank of India's (RBI) latest monetary policy decision, as reflected in the minutes of the February Monetary Policy Committee (MPC) meeting, presents a nuanced landscape of optimism about India's growth prospects, juxtaposed with concerns over inflation risks. The views of various MPC mem

Indonesia's Elections: Prabowo Subianto Emerges as Front-Runner

February 22, 2024 11:30 AM UTC

Prabowo Subianto emerges as the front-runner in Indonesia's recent national elections, securing a substantial lead of approximately 60% in preliminary sample counts, potentially avoiding a runoff and reducing political uncertainty. While his decisive victory provides him with political capital, conc

China: Yuan Outflow Fears Versus Net Exports

February 21, 2024 11:00 AM UTC

Despite a still overvalued Yuan, China authorities are reluctant to accept too much Yuan weakness for fear of causing domestic capital outflows and discontent with China’s government. At some stage, if GDP growth surprises on the downside, China authorities could decide that a controlled Yuan decl

China: 5yr LPR Cut But Not 1yr LPR

February 20, 2024 9:17 AM UTC

A larger than expected 25bps cut in the 5yr Loan Prime Rate (LPR) has been delivered, but the 1yr LPR rate was unchanged given that PBOC reluctance to cut the 1yr Medium-Term Facility rate (MTF) this month.  The 5yr LPR rate is not a game changer for residential property, as bigger policy moves are

BJP's Political Confidence Shines Through in India's FY25 Interim Budget

February 13, 2024 10:44 AM UTC

India's interim budget for FY25 presented ahead of the upcoming general election, reflects the government's commitment to economic growth, infrastructure development, and fiscal responsibility. Finance Minister Nirmala Sitharaman highlighted key aspects of the budget, emphasizing a multi-pronged app

Reserve Bank of India Review: No Rate Cut On The Horizon

February 12, 2024 6:25 AM UTC

The Reserve Bank of India's Monetary Policy Committee, led by Governor Shaktikanta Das, chose to keep the repo rate unchanged at 6.5% for the sixth consecutive time, aiming to support ongoing economic recovery while ensuring a sustained decline in inflation. Despite signs of inflation moderation and

Reserve Bank of India Preview: No Rate Cut In Near Term

January 31, 2024 11:11 PM UTC

The RBI will keep the repo rate unchanged at 6.5% during the upcoming monetary policy committee meeting on February 8th. The current tight stance is expected to persist until at least mid-2024, as the central bank foresees inflation averaging 5.4% year-on-year in FY24, ending on March 31, 2024, befo

Climate Change: 2025-30 Rather than Long-Term Impacts

January 26, 2024 4:15 PM UTC

Bottom Line: In the 2half of the 2020’s GDP in DM economies will benefit from climate change investment, though the net positive impact will likely be modest on an annual basis. The impact on EM economies will be more mixed, as lack of fiscal space restrains the scale of green investment and some

India Rising: Upward Trajectory to Sustain

January 23, 2024 3:07 PM UTC

India's economic landscape in FY24 continues to impress with robust growth across various sectors. With a stellar GDP performance in Q2, heightened foreign investments, and impressive performance in areas like aviation and coal production, India’s growth trajectory appears to be increasing consist

Hong Kong Political Risk Remain

January 18, 2024 4:00 AM UTC

Hong Kong is assigned a medium-low overall risk, with political violence at the same risk level.

Thailand: Watching the Politics

January 17, 2024 9:00 PM UTC

Following Thailand’s elections in May 2023, the country’s political forecast appears to be marked by both challenges and promises of reform. multiracial Pakatan Harapan (PH) coalition, will find it challenging to spearhead a unity government incorporating pro-Malay factions. 

Singapore: Political Stability Sustained

January 17, 2024 11:50 AM UTC

Singapore's political climate appears poised for stability, with a focus on economic growth, regional collaboration, and maintaining a neutral stance in global geopolitics.

China: GDP 5.2% for 2023, but 2024 To Struggle

January 17, 2024 9:24 AM UTC

Quarterly GDP is interesting and came in at 1.0% after the 1.3% quarterly gain in Q3.  The trend in quarterly GDP (Figure 1) is also not consistent with 5% growth and the Yr/Yr will dip in Q1 2024 when the large gain in Q1 2023 drops out (due to the end of zero COVID policies).  We maintain the 4.

Asia Country Risk Ratings

January 16, 2024 11:57 AM UTC

We provide country risk reviews for Asia countries including India, Indonesia, Malaysia and Taiwan.  

Indonesia: PDI-P To Maintain Power and Policies

January 16, 2024 9:17 AM UTC

Indonesia, the world's fourth-most populous nation, is poised for a significant political transition as President Joko Widodo, widely known as Jokowi, is set to step down in early-2024 after a presidential election.  Looking ahead to the upcoming legislative and presidential elections scheduled for

Taiwan: DPP Weaker than 2020

January 15, 2024 8:49 AM UTC

The DPP have won the Taiwan presidential election.  However, the DPP has lost its majority in parliament, while the 3rd party (Taiwan People Party (TPP) are signalling they will not form a coalition with (Kuomintang) KTT.  This will restrain the DPP.  However, China will still likely show its dis

China: January MTF and March RRR Cut?

January 12, 2024 9:25 AM UTC

Figure 1: China RRR (%)Source: Datastream/Continuum Economics  
A senior PBOC official has hinted at an RRR cut on Tuesday (here), given the desire to sustain credit growth.  Similar comments were evident last July before the RRR cut in September.  We would argue that further monetary easing is l

Webinar Recording December Outlook: Rate Cuts Into 2024

January 11, 2024 8:22 AM UTC

You can now access the webinar for the December Outlook here. 
To read the individual chapters please see the weblink below.  
Outlook Overview: Rate Cuts Into 2024 (here)
U.S. Outlook: Slower Growth to Sustain Improved Inflation Picture (here)
LatAm Outlook: Diverging Paths in 2024 (here)
China Outloo

Shipping Freight Cost Jump and Inflation – Some Perspectives

January 9, 2024 2:24 PM UTC

Figure 1: Freight Cost Surge in Perspective
Source: DataStream 
How Long?
Houthi rebels have been attacking some ships in the Red Sea in recent weeks.  The key question is how long this will last?  One line of thinking is that the Houthi attacks are part of Iran axis of resistance alongside attacks

Charting our Views December Outlook

January 8, 2024 9:05 AM UTC

Outlook Overview: Rate Cuts Into 2024 (here)
Economic Scenarios 
U.S. Outlook: Slower Growth to Sustain Improved Inflation Picture (here)
LatAm Outlook: Diverging Paths in 2024 (here)
Brazil Policy Rate and CPI Inflation (YoY, %)
China Outlook: Headwinds To China Growth (here)
Japan Outlook: Normalizing

Bank Indonesia Navigating the Path to Sustained Growth

January 5, 2024 10:17 AM UTC

Delving into the components of CPI, the December easing is attributed to a multifaceted slowdown in both food and utility prices. Disinflationary pressures from household equipment, restaurants, and personal care items contributed to the overall dip. However, information and recreation prices exerte