20180808-大华银行-Markets_Overview_5页_245kb

Global Economics & Markets Research Summary (08 August 2018)

Core Content Overview

This document provides a comprehensive overview of global economic and financial market developments, including key economic data, central bank outlooks, FX rates, equity indices, bond yields, and commodity prices as of 08 August 2018. It also highlights upcoming market events and holidays.

Main Highlights

Markets Overview

• Global Economic Docket: Relatively light on Wednesday, with key data from Australia and China.
• China's July Trade Data: Expected to be released at 11 am, with the focus on the impact of the $34 billion US-China tariffs. The market anticipates stable export and import growth at 10.0% y/y and 16.5% y/y, respectively.
• Other Data Releases: Includes Philippines trade numbers for June (9 am) and Bank of Thailand (BOT) rate decision (3:05 pm).

Central Bank Outlook

• Reserve Bank of Australia (RBA): Maintained the OCR at 1.50% for the 22nd consecutive meeting. No rate hike expected until the second half of 2019 unless wages rise substantially above inflation.
• Reserve Bank of New Zealand (RBNZ): Expected to keep the OCR at 1.75%. Mixed economic developments may keep the NZD near current levels.
• Bank of Thailand (BOT): Expected to keep the rate unchanged at 1.50%, with all 20 Bloomberg analysts forecasting no change.
• Philippine Central Bank (BSP): Likely to hike interest rates by 50bps to 4.00% due to rising inflation, which reached 5.7% y/y in July, mainly driven by food and non-alcoholic beverages.

FX Rates

• USD: Fell against most currencies, with SGD trading at 1.3643 (down -0.31% from the high of 1.3690). SGD NEER is expected to trade between 1.0% and 1.5% above the midpoint.
• EUR/USD: Slightly dipped but remained firm on the crosses.
• GBP: Continued to struggle, hitting a low of 1.2924.
• Asian Currencies: Broadly advanced against the USD, with CNH up 0.7%, THB and IDR up 0.3%, and MYR up 0.1%.
• PBoC's CNY: Central parity was set stronger by 82 pips at 6.8431/USD, with UOB's model predicting a further increase of 76 pips.

Key Economic Data & Events

Equities

• US Major Indices: The S&P 500, Dow Jones, and Nasdaq Composite all rose, with the S&P 500 nearing an all-time high.
• Asian Markets: SHCOMP rebounded strongly by 2.7%, while HSI and STI also showed gains of over 1.5% for the day.

US Treasuries

• Yields Rose: Due to strong corporate earnings and increased supply of government bonds.
• Key Auctions: The US Treasury sold $34bn in 3-year notes and is set to sell $26bn in 10-year notes and $18bn in 30-year bonds.

Commodities

• Oil Prices: Rose after the implementation of US sanctions on Iranian goods.
• Gold: Increased as the USD weakened against the CNY and investors focused on corporate earnings rather than trade tensions.

Economic Indicators Table

FX Rates (as of 07 Aug 2018)

Market Holidays/Events

Disclaimer

• This publication is for informational purposes only and should not be used for making investment decisions.
• It does not constitute financial advice, and no responsibility is taken for any reliance on the information provided.
• Views expressed are those of the author and may differ from UOB Group's actual trading positions.