India’s key services PMI plunged to a 15-month low to start the year
A largely unwelcome consolidation of the Philippines’ trade deficit in late-2024
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- India’s key services PMI has plunged to a 15-month low; the Q1 data so far point clearly to a GDP drop.
- We expect only a modest bounce in GDP growth in the Philippines in Q4, to 5.4%, from 5.2% in Q3.
- Thai exports stayed solid in Q4, but equally robust imports mute their lift, and downside risks prevail.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
A robust end to the year for Thai exports, despite flattening DM demand
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Taiwan’s retail sales look like they are picking up, as growth rose to 2.9% year-over-year in December.
- This is not the whole story; paradoxically, inflation continues to bolster the headline figure.
- Three typhoons, stubborn inflation and high credit costs have led to sluggish increases in volumes.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- India’s volatile gold imports corrected sharply in December, but their upward normalisation is intact.
- Total exports enjoyed a solid Q4, as the goods side revived, though services faltered heading into 2025.
- Net trade should hit Q4 GDP by 0.2pp, down from +1.5pp in Q3, due to adverse import base effects.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Every major city in Taiwan is now “impossibly unaffordable”; the housing bubble is expanding.
- The central bank is trying to dampen demand, but overly aggressive policies may create a crisis...
- …The opposite, however, would increase the risk of a more severe housing-price crash down the line.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: Gold imports correct sharply—again—but their broad trend is upwards.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: A genuine surprise; at least three more cuts this year.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
Ignore the volatility, Indonesia's trade surplus is growing, slowly
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Bank Indonesia surprised the universal consensus for a hold this month, lowering the BI rate to 5.75%…
- …The Board is right to tolerate the rupiah’s dollar- driven slump, amid its rising GDP growth worries.
- Ignore the December collapse in the trade surplus; smoothing out the noise yields a rising trend.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
Expect a quieter year for Indian WPI inflation in 2025
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- CPI fell more comfortably within the RBI’s target range in December, clearing the way for a rate cut…
- …More downside is in store for food inflation, but the upward normalisation in the core isn’t over yet.
- The rupee’s weakness of late probably has the RBI’s blessing; it’s been kept stable for far too long.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: Carpet being rolled out for a February rate cut.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- In one line: A credible pop in growth, Diwali noise aside.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
Indonesian sales growth should at least settle at a floor, shortly
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- India’s 6.4% advance GDP estimate for 2024/25 is on the rosy side and includes contradictory details…
- …The slowdown isn’t over, and we can’t see how the FAE squares rising demand with falling imports.
- Retail sales in Indonesia appear to have ended 2024 ver y softly; this is oddly reassuring.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
Real import demand in the Philippines was due a correction
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Taiwan’s export growth moderated in December, though the headline was tarnished by base effects…
- …Import growth nearly doubled to 30.4%, from 19.8% in November, pulling down the trade surplus.
- Headline inflation remained stubborn in December, at 2.1%, due to a continued rise in food inflation.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
Huge revisions put a more positive spin on Philippine sales
Oil-sensitive components drive the December rise in inflation
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
- Philippine inflation surprised to the upside in December, but the culprits should be temporary…
- …We still see average inflation of just 2.4% in 2025; core inflation isn’t yet making a real comeback.
- Thai CPI was softer than expected last month, and the 2025 consensus could do with a downgrade.
Miguel Chanco (Chief EM Asia Economist)Emerging Asia
