March 21, 2025 05:46 GMT
MNI Asia Pac Weekly Macro Wrap:
A weekly wrap of some of the key data outcomes/macro themes from the Asia Pac region.
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- The BoJ left rates unchanged at 0.50%, as widely expected by sell-side economists and financial market pricing. The decision was unanimous, with a 9-0 vote. The BoJ left the door clearly ajar for further policy adjustments. It stated that price trends are likely to move in line with its 2% goal in the second half.
- February National CPI showed easing y/y momentum for headline measures, but this was still above market expectations. The detail showed moderating y/y services inflation though.
AUSTRALIA
- February employment was weaker than expected falling 52.8k due to fewer older people returning to work, while January was revised down to +30.5k. There has been an increase in retirees in recent months according to the ABS. The number of unemployed also fell and so the unemployment rate was unchanged at 4.1%, while underemployment continued to fall.
NEW ZEALAND
- Growth in Q4 was stronger than both consensus and the RBNZ projected. Production-based GDP rose 0.7% q/q but was still down 1.1% y/y after -1.1% q/q & -1.6% y/y, while expenditure-based GDP increased 0.8% q/q to be down only 0.4% y/y following Q3’s -0.9% q/q & -1.2% y/y. The recovery was fairly broad-based but domestic demand growth remained soft.
- Both the BNZ services and manufacturing performance indices in Q1 improved compared to Q4 but the manufacturing sector is outperforming recording growth in both January and February. Services returned to contractionary territory in February.
- The Q4 current account deficit narrowed substantially due to strong growth in exports of both goods and services. At 6.2% of GDP it was its lowest in three years.
SHORT TERM RATES
- $-Bloc Markets have been muted over the past week despite key data/events:
CHINA
- China’s February activity data were mixed with IP, retail sales and fixed asset investment stronger than expected but the property sector remained weak and the unemployment rate surprisingly increased.
- Banks in China kept their benchmark loan prime rates unchanged at 3.1% for 1-year and 3.6% for 5-year.
SOUTH KOREA
- South Korea’s first 20-days of March trade data saw improved export growth, but clouds hang over the external outlook given planned reciprocal tariffs from the US.
ASIA
- Bank Indonesia kept rates at 5.75% on Wednesday as was widely but not unanimously expected. With significant volatility in Indonesian markets this week and the rupiah underperforming other Asian currencies, it put FX stability before growth.
ASIA EQUITY FLOWS
- Outside of South Korea, week to date flows remain negative across the region.
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