Economic Snapshot for ASEAN
October 17, 2019
Growth dynamics should improve in 2020 after the U.S.-China trade war weighed on the regional economy this year. Accommodative fiscal and monetary policies will support growth, while the recent easing in trade tensions could reduce headwinds. A slowdown in China and a potential reescalation of trade tensions are key downside risks to the outlook.
ASEAN Monetary & Financial Sector News
According to preliminary data, regional inflation edged down to 2.1% in September from 2.2% in August. Regional average inflation is expected to strengthen in 2020, partially due to cheaper borrowing costs and a pick-up in economic activity across the region.
ASEAN central banks continued to loosen their monetary policy stances in recent weeks, with central banks in Indonesia, the Philippines and Vietnam cutting interest rates by 25 basis points. For 2020, a majority of panelists expect further rate cuts in Indonesia, Thailand, Malaysia and the Philippines, given subdued inflation outlooks and heightened external risks.
ASEAN currencies displayed mixed performances in recent weeks owing to looser monetary policy settings in both ASEAN and the United States, as well as news related to China-U.S. trade talks. Turning to 2020, the regional average exchange rate is expected to appreciate slightly against the U.S. dollar due to strong regional growth and healthy current account surpluses.
ASEAN Economic News
Singapore: Non-oil exports contract at milder pace in September
October 17, 2019
Non-oil domestic exports (NODX) fell 8.1% year-on-year in September, improving slightly from the revised 9.0% decline in August (previously reported: -8.9% year-on-year).
Malaysia: Malaysian government unveils prudent budget for 2020
October 15, 2019
On 11 October, the Malaysian government presented the 2020 budget, which aims to strike a balance between continuing fiscal consolidation efforts and introducing stimulus measures to buffer against a larger economic slowdown.
Indonesia: Indonesia records a trade deficit in September, decline in exports and imports softens
October 15, 2019
According to Statistics Indonesia, the country recorded a trade deficit of USD 0.2 billion in September, contrasting with market expectations of a surplus and driven by a much slower fall in imports.
Philippines: Remittances inflows slow in August
October 15, 2019
Cash remittances from Overseas Filipino Workers (OFW) totaled USD 2.6 billion in August, increasing 4.6% in annual terms, which was down from the 7.5% expansion in July (USD 2.6 billion).
Malaysia: Industrial output growth picks up in August
October 11, 2019
Industrial output increased 1.9% year-on-year in August, up slightly from July’s five-year low of 1.2% growth, but just shy of market expectations of a 2.0% expansion.
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