Thailand
Malaysia: The week ahead – Inflation data, Aussie rate cut, Bank Negara accounts
Quiet week
There is no major economic data due this week except for the international reserves of Bank Negara.
The central bank is expected to announce the statement of accounts as at Sept 30 on Wednesday.
The international reserves of Bank Negara amounted to US$104.8bil as at Sept 15.
The reserves position is sufficient to finance 8.7 months of retained imports and is 1.1 times total short-term external debt.
Economic data updates from the external front will dominate markets next week.FOMC minutes
The key release from the US will be the Federal Open Market Committee (FOMC) meeting minutes for Sept 16.
In addition, there are several Federal Reserve speakers due to speak at public forums throughout the week.
The Fed has signalled that rates will be near zero well into 2023, and the minutes could show what they might need to see before they could raise rates.
Inflation data
South Korea, Taiwan, Thailand, and the Philippines are expected to announce their inflation data for September.
ING senior Asia economist Prakash Sakpal said all should see inflation continuing to be subdued. With the exception of India, inflation across the region has been low. And, whatever inflation there is, it’s mainly in the food component.
ING noted that low inflation might be an argument for more monetary policy accommodation to revive growth.
However, not many Asian central banks have that easing space anymore, especially those with policy rates already close to zero.
Australia may lean towards rate cut
The Reserve Bank of Australia (RBA) will meet this week amid growing expectations of a rate cut from the current official cash rate of 0.25%.
According to the Bloomberg poll, nine of the 11 economists surveyed expect RBA to keep policy unchanged at 0.25% while there are two economists who expect the RBA to cut by 15 basis points to a fresh record low of 0.1%.
UOB Global Economics and Markets Research expects the RBA to remain on hold at 0.25% in October and believes RBA governor Philip Lowe remains unenthusiastic about negative interest rates.
A move into negative territory is also not its base case, but UOB suspects the RBA will continue to give it due consideration.
ING expects no changes to the RBA cash rate from the current 0.25%.
Source: https://www.thestar.com.my/business/business-news/2020/10/05/the-week-ahead—inflation-data-aussie-rate-cut-bank-negara-accounts