The Week Ahead

Trade focus

EXTERNAL trade data to be released this week will be closely watched, in particular for impact of China’s lockdowns.

Analysts said weakening Chinese demand is starting to be felt in the export sectors of other Asia-pacific economies.

Analysts expect the trade surplus to be around Rm25bil while exports to sustain double-digit growth.

According to Trading Economics global macro models and analysts’ expectations, the balance of trade is expected to be at Rm45.37bil by the end of this quarter.

Meanwhile, a handful of companies including Sunway Real Estate Investment Trust, IOI Corp Bhd, Dialog Group Bhd and LBS Bina Group Bhd are set to announce their quarterly financial results this week.

China industrial production

A slew of economic data will be due from China, with the focus on industrial production figures, retail sales and loan prime rate (LPR) fixing.

According to a Bloomberg poll for the oneyear LPR, of the 11 economists, five expect no change at 3.7%, while three expect a 10-basispoint (bps) cut to 3.6% and another three expect a five bps cut to 3.65%.

UOB Global Economics and Markets Research expects the LPR to be cut in this fixing and has maintained its forecast for the benchmark one-year LPR to fall to 3.55% by the end of second quarter or third quarter of 2022.

S&P Global said both retail sales and industrial production data are expected to have deteriorated compared to March amid widespread lockdowns that continue to affect the region.

Early Purchasing Managers’ Index data across both the manufacturing and services showed output contracting very sharply in April.

Bloomberg estimates China’s industrial production in April to grow 0.5% year-on-year (y-o-y) from 5% in March.

It also expect April’s retail sales to contract 6.2% y-o-y from minus 3.5% in March.

GDP reports

A series of gross domestic product (GDP) data will be due from Singapore, Japan and Thailand.

The latest Bloomberg median estimate suggested that Singapore’s GDP expanded 3.4%3.7% year-on-year (y-o-y) in the first quarter from the advance estimate of 3.4% y-o-y.

Based on the better-than-expected March industrial production rise of 3.4% y-o-y, UOB estimates first-quarter GDP will be revised higher to 3.6%

S&P Global said Japan’s first-quarter performance will be watched for the extent of the slowdown, with its forecast pointing to a 0.6% quarter-on-quarter decline.

Japan’s first-quarter GDP is expected to have contracted by 0.6% from the previous quarter (on a seasonally-adjusted basis) as both domestic demand and exports were dampened, according to ING.

The research house believes that consumption bottomed out at the end of first-quarter 2022 after the government lifted some mobility restrictions.