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| HKECIC Weekly Market News |
| 6 August 2018 |
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| Market Snapshots |
| Asia and Australasia |
Japan: Retail sales rose in June amid tight labor market
Japan’s retail sales rose 1.8% yr/yr in June, up from a pace of 0.6% in May, figures from the Ministry of Economy, Trade and Industry showed. The rise was driven by higher sales of fuel (+16.7%), machinery and equipment (+5.4%) as well as medicine & toiletry stores (+3.9%), among other things, while sales of motor vehicles (-5.1%) and fabrics apparel (-2.1%) declined. Retail sales have increased for the eighth straight month, suggesting a strong underlying trend for private consumption amid tight labor market. The unemployment rate edged up to 2.4% in June from 2.2% in May, but continued to hover near the lowest level in more than a quarter of a century. |
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| Europe |
Eurozone: Economy slows down in Q2
According to the preliminary estimate from Eurostat, the eurozone economy grew by 0.3% qtr/qtr in Q2. It marked the slowest pace of expansion since Q2 of 2016. Compared with the same quarter last year, the eurozone economy expanded 2.1% in Q2, following a 2.5% growth in the previous quarter. While Eurostat did not provide details of how different parts of the economy performed, previous data and surveys point to a fall in export growth during the first half of 2018 and a waning of business optimism amid the growing trade tensions with the US, as well as uncertainties about access to the UK market as the country is set to leave EU in March 2019. Separately, a report from the European Commission showed that Eurozone’s Economic Sentiment Indicator (ESI) remained virtually unchanged, easing from 112.3 in June to 112.1 in July.
Turkey: Trade deficit narrows in June
Data from the Turkish Statistical Institute showed that Turkey’s exports decreased by 1.3% yr/yr to US$12.95 billion in June, while its imports fell at a deeper 3.8% yr/yr to US$18.45 billion, as purchases from its top importer China dropped. As a result, Turkey posted a trade deficit of US$5.50 billion in June. Earlier, President Erdogan named his son-in-law Berat Albayrak to head the Treasury and Ministry of Finance. The appointment has intensified investor’s concerns about the concentration of power and central bank’s independence. |
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| North America |
US: Trump administration considers raising pending tariffs on US$200 billion of Chinese goods to 25%
President Donald Trump has directed the US Trade Representative (USTR) to consider increasing the proposed level of the additional tariff on US$200 billion worth of Chinese goods from an original 10% to 25%, further escalating the trade tensions between the two countries. The further increase in additional tariff is intended to provide the US with additional options to encourage China to adopt policies that will lead to fairer markets. In light of the proposed increase, the USTR has extended the public comment period from 30 August to 5 September, and the additional tariff could be implemented as early as next month. In response, China announced retaliatory tariffs from 5% to 25% on US$60 billion of US goods and would be applied if the US go ahead with its latest tariff. |
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Heritage Home Group LLC, a US-based furniture company, has filed for Chapter 11 bankruptcy protection to restructure its debt. The company blamed its financial problems on changing consumer patterns and industry conditions, among other things. According to court filing, the company listed both assets and liabilities in the range of US$100 million to US$500 million.
Brookstone Inc, a US-based gadget and gift chain, has filed for Chapter 11 bankruptcy protection. The company said it is closing all of its 101 stores in malls across the US and will continue to operate its 35 airport stores and e-commerce and wholesale businesses. According to court filing, the company listed assets in the range of US$50 million to US$100 million and liabilities in the range of US$100 million to US$500 million. |
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Hong Kong Export Credit Insurance Corporation
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Copyright © 2018 Hong Kong Export Credit Insurance Corporation |
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Disclaimer
The information contained in the ‘Weekly Market News’ (WMN) is compiled by the Hong Kong Export Credit Insurance Corporation ("HKECIC") for general information only. Whilst HKECIC endeavours to ensure the accuracy of this general information, no statement, representation, warranty or guarantee, express or implied, is given as to its accuracy or appropriateness for use in any particular circumstances.
HKECIC is not responsible for any loss or damage whatsoever arising out of or in connection with any information including data or programmes on the WMN. HKECIC reserves the right to omit, suspend or edit all information compiled by HKECIC on the WMN at any time in its absolute discretion without giving any reason or prior notice. Users are responsible for making their own assessment of all information contained in this WMN and are advised to verify such information and obtain independent advice before acting upon it.
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