Ahead Today
G3: US Retail Sales, US Initial Jobless claims, US industrial Production
Asia: China property market briefing
Market Highlights
Global risk sentiment stabilised yesterday after the volatility in tech stocks induced by worse than expected earnings result from ASML. Nonetheless, the broader undercurrents of uncertainty around the US election results remain, with a variety of markets moving increasingly further to price for a Trump victory, coupled with geopolitical risk still lurking in the background all makes for a jittery market still. Later today, we will have US retail sales where consensus is expecting steady growth of around 0.3%mom. Meanwhile, US will also release initial jobless claims, where the numbers may show some impact from recent typhoons in Florida.
In China, President Xi Jinping called on government officials to make every effort in the final quarter to help the country meet its growth target of around 5%. He called on government officials to “conscientiously implement” existing economic policies. On that front, today China’s housing minister alongside officials from the central bank, the finance ministry and the NFRA will hold a news conference to flesh out the government’s approach to tackling China’s property crisis.
Regional FX
Asian FX markets were mixed to weaker with a stronger Dollar overnight. PHP (-0.48%), KRW (-0.5%) and SGD (-0.3%) underperformed, while THB outperformed rising 0.5%. There were three Asian central banks – Indonesia, the Philippines, and Thailand – which announced their monetary policy decision. The biggest surprise was certainly the Bank of Thailand, where the MPC cut rates by 25bps, bringing the policy rate to 2.25% from 2.50% previously. Five out of seven member supported the rate reduction. The majority of voting members on the BOT MPC agreed to lower rates to help alleviate the debt burden, and the Committee is of the view that the policy rate should remain at a neutral level and in line economic potential, and not be too low which could lead to the accumulation of financial imbalances in the long run. Meanwhile, the Philippines central bank cut rates by 25bps, with Governor Eli Remolona saying that the central bank will keep a measured approach in its monetary easing cycle. The central bank also raised its assessment of the risk-adjusted inflation outlook for 2025 and 2026 due to potential adjustments in electricity rates and higher wages. Last but not least, Bank Indonesia kept its key rate on hold, but still sees room for further monetary policy easing while keeping in mind the outlook for inflation, the Rupiah, and economic growth.
