- "In line with global trends, market sentiment the past week across Asia was dented by indicators of slower global and regional growth. In addition to weaker data on the jobs and housing front in the U.S., markets reacted to a lower-than-expected PMI reading for June in China (see Highlights). Japan also posted lower-than-expected outturns for retail sales and industrial production. On the policy front, at the end of the week India raised interest rates to tame inflation. The timing of the move was unexpected (intermeeting), although markets had been expecting the possibility of a rate hike."
- "Korea, whose government recently revised up its 2010 growth outlook, posted better-than-expected exports for June, together with a set of robust data on domestic demand and production. Vietnam also posted a robust Q2 GDP outturn (6.4% y/y). And on the CPI front for June, inflation in Korea and Thailand moderated, although Indonesia posted a higher-than-expected CPI outturn (5.1%). Other positives were the signing of an anticipated trade agreement between China and Taiwan (see Highlights), and the reaching of a comprise in Australia on a new mining tax."
- "Monetary policy meetings will take place in a number of countries (see Highlights). We expect Indonesia, Malaysia, and Australia to remain on hold, with a possibility of a first rate hike in Korea. Markets will also be watching China’s June export figure at the end of the week to gauge the extent of the slowdown and whether global demand is weakening."
BBVA Asia Weekly Watch 20100705
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