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| HKECIC Weekly Market News |
| 3 September 2018 |
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| Market Snapshots |
| Asia and Australasia |
Hong Kong: Exports up 10.0% yr/yr in July
The Census and Statistics Department reported that the value of Hong Kong's total exports of goods increased 10.0% yr/yr in July, after going up 3.3% in June. For the first seven months of 2018 as a whole, the value of Hong Kong's total exports of goods rose by 9.4% over the same period in 2017. The increases were registered to most major destinations, in particular the Mainland China (+12.1%), Singapore (+11.6%), Germany (+11.0%), Netherlands (+10.0%), USA (+9.3%) and Thailand (+8.6%). A Government spokesman commented that while the impacts of the US-Mainland trade conflicts on Hong Kong's export performance appeared to be limited so far, they could become more apparent later this year. Global economic growth will also be affected if the trade conflicts are to persist or escalate further.
Japan: Retail sales rose for a ninth straight month in July
Japan’s retail sales increased 1.5% yr/yr in July, following a 1.7% gain in June, figures from the Ministry of Economy, Trade and Industry showed. The growth was driven by higher sales in various types of business, including fuel (+17.5%), medicine & toiletry stores (+4.8%) and non-store retail (+2.4%), while the sales of fabrics apparel (-3.8%) and other general merchandise declined (-3.1%). Retail sales have risen for a ninth straight month in July, reinforcing the view that private consumption is supporting economic growth amid low inflation rate, which stayed well below the central bank’s 2% annual target. The Japanese economy grew 0.5% qtr/qtr in Q2 2018, compared with a 0.2% decline last quarter. |
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| Europe |
Germany: Business Climate Index rises for first time this year
Survey from the Munich-based ifo Institute showed the German Business Climate Index rose noticeably to 103.8 points in August from 101.7 points in July, the first increase this year. The rise was contributed by improvements in all sectoral business climate indicators, including manufacturing, service, trade and construction. The Institute views that, in addition to a robust domestic economic situation, the truce in the trade conflict with the US contributed to improved business confidence. It added that current figures point to economic growth of 0.5% in the third quarter. |
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| Latin America |
Argentina: Central bank lifts interest rate to 60%
Argentina’s central bank has lifted its benchmark interest rate from 45% to 60%, the fifth rate hike this year, in an effort to stem a slide in the Argentine peso which plunged to a record low. Last week, Argentina’s president Mauricio Macri has asked the International Monetary Fund (IMF) for an early release of funds from a US$50 billion deal to ease concerns that the country will not be able to meet its debt obligations for 2019. The IMF said that it would consider the request, and Argentina needs to adopt stronger fiscal and monetary policies. The peso has depreciated about 50% against the US dollar year to date, overtook Turkey’s lira to become the worst performing currency in 2018. Separately, Standard and Poor's put the country’s B+ credit rating on CreditWatch with negative implications. |
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The Japanese government is considering restrictions on Chinese telecommunications firms Huawei Technologies Co., Ltd. and ZTE Corporation (SZSE: 000063 and HKEX: 0763) from bidding on public contracts for building information systems, in fear of cyber-attacks and leaks of confidential information. The news came just a week after the Australian government barred the two companies from providing 5G technology for wireless networks in the country over national security concerns. A spokesman of China’s Ministry of Foreign Affairs urged Japan to provide a fair and transparent environment for Chinese and Japanese enterprises to carry out normal and mutually beneficial cooperation. |
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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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