Data-filled week

       THIS will be a busy week of economic data and a torrent of corporate earnings releases.

       The Statistics Department is expected to release July’s consumer price index (CPI) on Wednesday, producer price index (PPI) on Thursday and external trade statistics on Friday.

       ING said Malaysia’s July inflation is expected to decelerate to 2.9% from 3.4% previously, on soft domestic demand and as base effects fade.

       The research house added that export growth may ease to 8% year-on-year (y-o-y) (from 27% previously).

       This will result in a trade surplus of roughly RM20mil, which should be positive for the ringgit in the near term.

       In addition, a handful of FBM KLCI heavyweights will file their earnings, including Petronas Dagangan Bhd, Petronas Chemicals Group Bhd, Telekom Malaysia Bhd, Axiata Group Bhd and Genting Plantations Bhd.

       Also, Petroliam Nasional Bhd or Petronas is announcing its half-yearly financial results on Friday.

       Singapore CPI and IP

       SINGAPORE’S CPI and industrial production (IP) for July 2021 are due today and Thursday, respectively.

       Bloomberg estimates Singapore’s July inflation to grow 2.2% and core inflation to expand 0.9% y-o-y.

       In July, Singapore’s industrial production was supported by firm exports, but ING expects a retracement from the outsized 25.7% y-o-y surge in June as base effects turn unfavourable.

       ING said Singapore’s July headline inflation should ease to 2.2% y-o-y from 2.4% from the previous month and core inflation probably ticked up to 0.7% y-o-y from 0.6%.

       BoK decision

       CENTRAL bank watchers will be monitoring the Bank of Korea’s (BoK) monetary policy meeting this week.

       According to a Bloomberg poll, both the analysts surveyed expect no change to its policy rate at 0.50%.

       UOB Global Economics & Markets Research also expects BoK to be on hold in August.

       BOK building

       It thinks the BoK is more likely to start normalisation in the fourth quarter of 2021, assuming that the infections can be contained by then.

       UOB expects a 25-basis-point (bps) hike in October and a further 50bps rate increase in 2022.

       This will bring the benchmark base rate to the pre-Covid level of 1.25%.

       Jackson Hole symposium

       THE focus will be on the Federal Open Market Committee (FOMC) chair Jerome Powell who will speak on Aug 27.

       Some analysts including UOB believe that he may give details of the anticipated timeline for the Fed’s quantitative easing (QE) tapering.

       However, there are others who believe that this will be a non-event.

       Fed Powell

       ING said the headline discussion will be “Macroeconomic Policy in an Uneven Economy”, but the main focus for markets will be the discussions surrounding what appears to be an impending tapering of the Fed’s QE asset purchase programme.

       It said the minutes to the July FOMC meeting weren’t especially clear, with lots of discussions over whether the threat of higher inflation should prompt an earlier tapering or whether the delta variant of Covid-19 could “damp the recovery” and justify a delay to tapering.

       Flash PMIs

       FLASH PMI surveys will be released today for a first look into August economic conditions across the US, euro zone, the United Kingdom, Japan and Australia.

       IHS Markit said the flash data would be assessed, particularly on growth and price pressures, amid the mixed influence of better vaccine rates and deteriorating Covid-19 conditions globally.