ATI Newswire - Subscriber Only

FITCH RATINGS LIFTS PHILIPPINES TO INVESTMENT GRADE

March 27, 2013

MANILA - The Philippines’ sovereign rating has upgraded by one notch to investment grade (BBB-) by ratings agency Fitch, citing a persistent current account surplus and strong net external creditor position, the economy’s growth resilience over the past five years, and improvements in governance and fiscal management. The Philippines economy grew 6.6% in 2012, surpassing neighbouring Indonesia’s 6.2%.

RISKS BACK ON RADAR IN EMERGING COUNTRIES, SAYS COFACE

March 26, 2013

PARIS - Despite resilient growth, estimated at 5.1% in 2013, and improved sovereign and external fundamentals, emerging country risks have not disappeared altogether, but have changed form, according to credit insurer Coface. “Three major risks now weigh on emerging markets,” Coface says. “Politically, tensions have sharpened, illustrated by protests in North Africa and the Middle East, and now also in Russia and India. Economically, we are seeing a rise in protectionist measures.

HTC TO LAUNCH SECOND-GENERATION ‘BUTTERFLY’ PHONE

March 25, 2013

TAIPEI - Taiwan's HTC Corp. plans to launch a second generation "Butterfly" customised smartphone to capitalize on growing consumer interest in the large-screen phone segment. Ben Ho, chief marketing officer of HTC, said the 5-inch Butterfly was originally customised for certain mobile carriers in Japan and has since been introduced in other markets, such as the US and Taiwan, where consumers have been attracted by its large screen.

CHINA ANTI-DUMPING DUTIES PLACED ON MORE CHEMICALS

March 25, 2013

BEIJING – China’s Ministry of Commerce has announced it will start to collect anti-dumping levies on the chemical resorcinol, currently imported from the US and Japan. The tariff is the latest in a list of levies introduced on imported chemicals, such as a recent tariff placed on toluene diisocyanate from the EU, a chemical used in manufacturing rubber, dyes and plastics. Japanese companies will face 40.5% import duty on resorcinol, and US companies 30.1% tariff. The move is seen by observers as indicative of a deterioration of trade relations between China, and the US and EU.

STATE BANK OF VIETNAM CUTS RATES BY ANOTHER 1%

March 25, 2013

HANOI - The State Bank of Vietnam (SBV) has cut its policy rate by another 100 basis points to 8%. This follows a cumulative 600 basis points of cuts in 2012 - the most recent cut was 100 basis points in late December. The SBV also reduced the cap on dong deposit rates by 50 basis points, to 7.50% from 8%, with the hope of incentivising banks to reduce their lending rates. ANZ Bank says it believes this will be the last cut for the year - but says there are risks of another cut if economic data deteriorates further.

CHINA FLASH MANUFACTURING INDEX AT TWO-MONTH HIGH

March 21, 2013

HONG KONG – The HSBC Flash China Manufacturing PMI™ for March has come in at 51.7 (50.4 in February), a two-month high. The Flash China Manufacturing Output Index was at 52.8 (50.8 in February), also a two-month high. On data collected between March 12 and 19, HSBC reported that output, new orders and new export orders all increased at a faster rate while output and input prices both fell. Supplier delivery times are lengthening.

JAPAN’S EXPORTS REMAINED WEAK IN FEBRUARY

March 21, 2013

TOKYO - Japan recorded its eighth consecutive monthly trade deficit in February, at 777.5 billion yen, as exports dropped by a more-than-expected 2.9% y/y. Exports to China declined by15.8% y/y due to the Chinese New Year holiday; those to Europe fell by 9.6%, while shipments to U.S. rose 5.7%.  Meanwhile, imports rose by 11.9% y/y on higher energy imports, as a result of both the weaker yen and the shutdown of Japan’s nuclear plants. (ATI).

EIU GLOOMIER ON EUROPE, EDGES CHINA GROWTH FORECAST DOWNWARDS

March 20, 2013

LONDON – In an update of its Global Forecast, the Economist Intelligence Unit says it now expects GDP in the 17-nation Eurozone to shrink by 0.4% in 2013, doubling its previously forecast - contraction of 0.2%. The EIU says Government austerity will continue to dent consumer demand, and that bank lending remains weak in most countries. “Nonetheless, Germany's economy is reviving. Manufacturing in February expanded for the first time in a year and business and consumer sentiment are rising steadily,” the EIU says.

CHINESE INVESTMENT IN AUSTRALIA LEADS OFFSHORE PLUNGE

March 20, 2013

BEIJING – China’s overseas investment increased 147% year-on-year during the first two months of 2013, surpassing inbound investment from abroad. The total amount invested was US$18.39 billion, attributed to an increase in the acquisition of energy resources abroad. Outbound investment grew 30% in 2012 compared to the year before. Overseas direct investment is predicted to overtake foreign direct investment over the next few years.

CHINA ROAD-MAPS INTEREST RATE AND EXCHANGE RATE REFORMS

March 19, 2013

BEIJING - Local news media is reporting that PBoC Deputy Governor Liu Shiyu has outlined a roadmap of financial reforms for the next 10 years. Highlights include: i) interest rate and exchange rate liberalisation to be completed within 10 years (in the absence of external shocks), including enhancement of RMB convertibility and capital account opening; ii) further opening of the banking sector to domestic and foreign investors; and iii) development of the capital market. www.bbva.com (ATI).

CHINA FDI INFLOW FOR FEBRUARY AHEAD OF EXPECTATIONS

March 19, 2013

BEIJING - FDI inflows for February surprised to the upside at 6.3% y/y (consensus: -4.8%), marking the first year-over-year increase since June 2012. Together with the out-turn in January, the FDI inflow of the first two months declined by 1.3% y/y, indicating modest stabilisation. Investment from the EU increased notably (34% y/y) during January-February, while investment from US (-5.4%) and Japan (-6.7%) remained weak. At the same time, FDI outflows more than doubled in January/February over the previous year’s period. www.bbva.com (ATI).

INDIA CUTS RATES FURTHER, BUT RBI CAUTIOUS ON FUTURE EASING

March 19, 2013

NEW DELHI - As anticipated, the Reserve bank of India (RBI) today reduced its benchmark repo rate by 25 basis points to 7.5% while maintaining the Cash reserve ratio at 4.0%. The move follows a 25 basis points cut at the RBI’s last policy meeting in January, and aims to stimulate investment activity as inflationary pressures abate and the Government executes much-needed fiscal reforms.

SINGAPORE EXPORTS FALL SHARPLY, UNDERSCORE WEAK EXTERNAL DEMAND

March 18, 2013

SINGAPORE - Non-oil domestic exports (NODX) fell by -30.6% y/y after a small increase in January. The decline was attributable to weak demand from Europe (-52.2% y/y) and the U.S. (-52.1%). BBVA Bank says that while Singapore’s monthly data are notoriously volatile (and may be distorted by the shift in this year’s Chinese New Year timing), the disappointing out-turn is a reminder of the weak external environment, as seen recently in weak export figures from Taiwan and Korea, in contrast to a surge in January/February exports from China.

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