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| HKECIC Weekly Market News |
| 1 April 2019 |
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| Market Snapshots |
| Asia and Australasia |
Hong Kong: Exports fall 6.9% yr/yr in February
The Census and Statistics Department reported that the value of Hong Kong's total exports of goods decreased by 6.9% yr/yr to HK$228.7 billion in February, after falling 0.4% in January. Taking January and February as a whole to neutralise the distortion caused by the difference in timing of the Lunar New Year holidays, the value of total exports of goods decreased by 3.1% over the same period in 2018. The decreases were registered to some major destinations, in particular India (-37.4%), Taiwan (-21.9%), the USA (-12.4%), Germany (-7.6%), Japan (-6.9%) and the Mainland China (-4.5%), while an increase was registered to Singapore (+14.7%). A Government spokesman said that, similar to the situations in many other Asian economies, Hong Kong's merchandise exports remained weak in early 2019, dampened by easing global economic growth and the US-Mainland China trade tensions. In the near term, the external trading environment is likely to remain challenging. While the US-Mainland China trade negotiations have reportedly entered the final stage, there are still uncertainties about whether and when the two sides will reach a final agreement. Other external developments, including global growth moderation and Brexit, also warrant attention. |
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| Europe |
UK: Second round of Brexit indicative votes to continue after May’s deal defeated
Last week, UK Members of Parliament (MPs) voted to take control of the Brexit process and the government was defeated by 329 votes to 302. MPs have then held indicative votes on eight proposed Brexit options but none of the proposal could secure clear backing in a series of votes. Although Prime Minister Theresa May offered to step down if the MPs supported her Brexit deal, MPs have rejected the deal for the third time that would allow a Brexit extension to 22 May. MPs are expected to take part in the second stage of the Brexit indicative vote process this week.
Germany: Business climate index rose for the first time in six months
Business survey from the Munich-based Ifo Institute showed that the German business confidence improved in March following six months of declines. The Business Climate Index rose to 99.6 points in March from 98.7 in February. Companies are more satisfied with their current business situation and more optimistic about their business outlook for the coming six months, the survey showed. In particular, business climate strengthened in service, trade and construction, but was weaker in manufacturing with worsened outlook falling to its lowest value since November 2012 amid declining demand. |
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| North America |
US: Trade deficit narrows from 10-year high
The US’s goods and services trade deficit narrowed to US$55.1 billion in January from its 10-year high of US59.9 billion in December 2018, data from the Department of Commerce showed. Trade balance improved as exports rebounded 0.9% to US$207.3 billion from a 1.9% drop in December, while imports fell by 2.6% to US$258.5 billion in January, posting the lowest level since last June. By commodity group, exports of foods, feeds, and beverages as well as automotive vehicles, parts, and engines increased, while imports of capital goods as well as industrial supplies and materials decreased. Meanwhile, the seasonally adjusted trade gap in goods with China decreased to US$33.2 billion from US$38.7 billion as soybean exports to China increased. Last week, White House Economic Adviser Larry Kudlow signaled that US could lift some tariffs on China as part of a trade deal with Beijing. Chinese Vice Premier Liu He will travel to Washington this week for a fresh round of trade talks with the US officials. |
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Chinese telecom equipment giant Huawei Technologies Co., Ltd has announced its full year financial results. For the year ended 31 December 2018, total revenue surged 19.5% to CNY721.2 billion which crossed US$100 billion mark the first time. Meanwhile, the European Union says it has developed a strategy to keep its 5G networks secure. It does not include a blanket ban on Huawei equipment. Separately, the UK’s National Cyber Security Centre (NCSC) reported that further significant technical issues have been identified in Huawei’s engineering processes, leading to new risks in the UK telecommunications networks. However, NCSC did not call for a ban on Huawei’s equipment being used in the roll out of 5G networks. |
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Hong Kong Export Credit Insurance Corporation
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Copyright © 2019 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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