Get 40% Off
🤯 Perficient is up a mind-blowing 53%. Our ProPicks AI saw the buying opportunity in March.Read full update

Things to watch in Asia: China retail sales, RBNZ interest rate decision

Published 14/08/2023, 09:54 am
© Reuters.

Investing.com - The forthcoming week could bring crucial economic indicators from Asia that may potentially reshape the fiscal strategies of its two largest economies. Investors will closely observe China's retail sales, industrial output, and housing price data while keeping an eye on Japan's GDP and inflation rates.

Further attention will be given to New Zealand and the Philippines as they deliver their decisions regarding interest rates. Additionally, India's inflation statistics are also expected to make headlines along with key corporate earnings reports emerging from Chinese giants such as Tencent Holdings Ltd (HK:0700), Lenovo Group (HK:0992) CNOOC Ltd (HK:0883), and JD.com (HK:9618).

Monday might witness a significant jolt in economic data coming out of India, where annual consumer price inflation is predicted to spike up sharply in July at 6.4% compared to 4.8% previously recorded; wholesale price deflation is also anticipated to slow down considerably.

Following last week’s events where NASDAQ reported its first consecutive weekly decline this year, causing iShares MSCI All Country Asia ex Japan ETF (NASDAQ:AAXJ) a loss of 2%, investors are likely adopting a cautious stance which could turn into outright pessimism post-Monday when Country Garden Holdings Company Ltd (HK:2007) - China's largest private developer - announced it would halt trading for its eleven domestic bonds.

With shares hitting an all-time low after failing to pay bond coupons worth $22.5 million due August 6th coupled with liabilities around $200 billion and potential losses reaching up to $7.6 billion during H1 alone – investor speculation about Beijing succumbing under pressure grows stronger amidst official confirmation of deflationary economy experiencing weakest credit impulse since 2009.

3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads .

Subpar financial figures later this week may compel authorities into action whereas Japanese inflation information will keep both investors' eyes peeled as well as Bank of Japan (BOJ). Economists predict the core CPI Inflation rate dropping slightly from June’s figure at 3.3% down to July’s estimated value of 3%.

Depending upon these findings we might see market reactions anticipating either gradual alterations in BOJ ‘yield curve control’ policy if numbers dip further or stickier inflation inciting the opposite response making yen more vulnerable especially considering the recent slump against euro, marking a new fifteen-year low.

This year hasn't been too kind for Asian stocks primarily because concerns over China struggling with a sluggish growth rate accompanied by deflationary pressures and capital outflows have cast long shadows over markets resulting in flat performance by Chinese blue-chip stocks while Hong Kong's Hang Seng Index dipped by four percent.

MSCI Asia ex-Japan equity index has now slumped consecutively past two weeks – a trend not witnessed since April showing a positive incline only twice over the past eight weeks.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.