Consumer price inflation in Indonesia remained manageable at 3.1% year-on-year (y-o-y) and 0.2% month-on-month (m-o-m) in September. The Central Statistics Agency said that September inflation

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News Highlights - Week of 3 - 7 October 2016

Consumer price inflation in Indonesia remained manageable at 3.1% year-on-year (y-o-y) and 0.2% month-on-month (m-o-m) in September. The Central Statistics Agency said that September inflation was driven by increases in the prices of commodities such as red chilies, mobile phone services, house rentals, education, cigarettes, and electricity rates, among others. Consumer price inflation in the Republic of Korea accelerated to 1.2% y-o-y in September from 0.4% y-o-y in August, while on a m-o-m basis, the Consumer Price Index (CPI) rose 0.6% in September after falling 0.1% in August. CPI inflation in September was buoyed by food and nonalcoholic beverages, which recorded increases of 5.6% y-o-y and 4.6% m-o-m.

*     In the Philippines, headline inflation accelerated to 2.3% y-o-y in September from 1.8% y-o-y in August as six out of eleven commodity groups in the CPI recorded faster y-o-y increases in September than in August. In the manufacturing sector, the Producer Price Index fell 4.5% y-o-y and 0.4% m-o-m in August.

*     Thailand’s CPI increased 0.4% y-o-y in September after rising 0.3% y-o-y in August, led by the increase in prices of consumer goods, particularly food and nonalcoholic beverages

*     Singapore’s Purchasing Managers Index for manufacturing climbed above the 50-point threshold in September to 50.1 after staying below this threshold over the past 14 months. More new orders and new exports and higher factory output all contributed to the slight expansion in manufacturing in September.

*     The Republic of Korea’s current account surplus narrowed to USD5.5 billion in August from USD8.7 billion in July. The merchandise trade surplus fell to USD7.3 billion in August from USD10.8 billion in July as exports of goods dropped 1.8% m-o-m to USD41.7 billion and imports rose 8.5% m-o-m to USD34.4 billion.

*     In Malaysia, the merchandise trade surplus widened to MYR8.5 billion in August from MYR1.9 billion in July. Exports rose 1.5% y-o-y in August to MYR67.6 billion, led by an increase in electrical products and electronics, palm oil and palm-based products, and refined petroleum, among others. Imports rose 4.9% y-o-y in August to MYR59.1 billion.

*     The People’s Republic of China’s (PRC) foreign exchange reserves fell to USD3.17 trillion in September from USD3.19 trillion in August.  The decline was due to efforts by the People’s Bank of China to stabilize the renminbi prior to a week-long holiday beginning on 1 October.

*     China Construction Bank listed a USDS600 million bond on Nasdaq Dubai last week. The bond carries a coupon rate of 1.75% and a tenor of 3 years.

*     Local currency government bond yields in the Republic of Korea and Singapore rose for all tenors largely tracking the uptick in the United States (US) bond yields following the release of better US jobs report. Bond yields mostly rose for all other emerging East Asian markets, except for Viet Nam where yields fell for all maturities. The spread between the 2- and 10-year maturities rose for most markets except for Hong Kong, China; and the Philippines, where yields fell.

*     Please note that the next issue of the Weekly Debt Highlights will be published on Tuesday, 18 October.