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| HKECIC Weekly Market News |
| 7 January 2019 |
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| Market Snapshots |
| Asia and Australasia |
China: Manufacturing activity contracts first time in over two years
According to the National Bureau of Statistics, China’s manufacturing Purchasing Manager’s Index (PMI) came in at 49.4 in December, down from 50.0 in the preceding month. This marks the first contraction in more than two years amid a domestic economic slowdown and the ongoing trade tensions with the US. The Bureau attributed the decline to the growing downside pressure on market demand and the large fluctuations in the prices of some substantial international commodities, among other reasons. In particular, new export orders shrank for the seventh month in a row in December, falling to 46.6 from 47.0 in November.
Singapore: Q4 GDP growth slows slightly to 2.2%
Singapore’s economy grew by 2.2% yr/yr in Q4, easing slightly from 2.3% in the previous quarter, according to an advance estimate from the Ministry of Trade and Industry. Economic growth was supported by the expansions in the manufacturing (+5.5%) and services (+1.9%) sector, while the construction sector (-2.2%) contracted. The contraction in the construction sector was primarily due to weakness in public sector construction activities. For 2018 as a whole, the economy grew by 3.3%, slowing from a three-year high of 3.6% in 2017. GDP growth in 2019 is expected to be between 1.5% and 3.5%, according to Prime Minister Lee Hsien Loong, but he warned of major uncertainties in the global economy amid growing trade conflicts, nervous financial markets and signs of slowing growth. |
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| Europe |
Turkey: Inflation eased for a second straight month in December
Data from the Turkish Statistical Institute showed that Turkey’s inflation rate fell to 20.3% yr/yr in December from 21.6% in November, mainly due to a softer rise in prices of food, clothing, housing and transport. Inflation has eased for a second straight month in December after Turkey’s government introduced tax reductions on several items, including house sales, furniture, white goods and motor vehicles, which went effective on 1 November 2018. Finance and Treasury Ministry Berat Albayrak has recently announced to extend the tax cuts for another three months until the end of March 2019. |
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| Latin America |
Brazil: Jair Bolsonaro sworn in as president
Jair Bolsonaro was sworn in as Brazil’s president on 1 January 2019, taking the reins of Latin America’s most populous nation with promises to reduce bureaucratic regulations, tackle corruption and fight crime. On the economic front, Bolsonaro has pledged to open foreign markets and carry out structural reforms to shore up a large public deficit. Separately, Brazil’s balance of trade closed out 2018 at US$58.3 billion positive, the second highest since the beginning of the historical series in 1989 according to the Ministry of Economy. |
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Top-Toy, a Denmark-based company operating toy chains BR and Toys ’R’ Us in the Nordic countries, has filed bankruptcy. The company had begun a process of restructuring in November 2018, but company representatives said disappointing sales over the Christmas season made continued business impossible. It cited increased competition, mounting pressure from online retail and the changing play habits of kids as the main reasons for the disappointing results. All stores across Denmark, Sweden and Finland have now been closed. The management of Top-Toy has been taken over by a number of trustees, and they have been tasked with liquidating and selling off as many assets as possible. |
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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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