Indonesian GDP came in higher than expected in Q4, up 5.7 per cent year-on-year in the quarter, above the average forecast of 5.3 per cent, as improving exports reduced the impact of slowing growth in domestic consumption and investment.
The full FT story is here. Beyondbrics presents a rundown of the analysts’ viewpoints (with our emphasis in bold). Continue reading »
Source: HSBC / Markit
The monthly temperature-taking of Asian manufacturing, aka the purchasing managers index, is out for some of Asia’s bigger economies – and at first glance, things look good.
China may have seen its HSBC/Markit (in contrast to the official government) index fall below the 50 mark that separates contraction from expansion, but India, Indonesia and South Korea all look in good shape.
Or do they? Continue reading »
As emerging markets remain rattled by investor jitters, Raghuram Rajan, India’s central bank governor, has resurrected a gripe of old by attacking the US for its lack of concern about the global impact of its withdrawal of extraordinary monetary stimulus.
Mr Rajan, a former chief economist for the International Monetary Fund, told Bloomberg India TV that “international monetary co-operation has broken down.”
“Industrial countries have to play a part in restoring that [co-operation], and they can’t at this point wash their hands off and say, we’ll do what we need to and you do the adjustment.” Continue reading »
If you are doing business in Asean – the Association of Southeast Asian Nations – be prepared for an electric shock.
Analysts at ANZ have looked at what’s happening with electricity prices across the region and are warning that they are set to rise, making it considerably more expensive to run factories. It will also add half a basis point on average to inflation, which is already inching up. Continue reading »
Indonesia’s powerful corruption commission has a new target. Having gone for members of the president’s inner circle, the country’s highest judge and dozens of parliamentarians, the Corruption Eradication Commission (KPK) now has the lucrative mining industry in its sights.
Adnan Pandu Praja, a deputy chairman of the KPK, told the Jakarta Foreign Correspondents Club on Wednesday that the agency was launching a crackdown on corrupt mining companies and some of the government officials, military officers and police who stand behind them. Continue reading »
As you’d expect, Indonesia’s new restrictions on raw-mineral exports have gone down badly overseas. US mining majors Newmont and Freeport have decried the sliding scale of increasingly tough taxes, arguing that their original contracts of works to dig up copper and gold should shield them from subsequent law changes.
The Japanese nickel industry is upset, too. Unlike copper, iron ore, lead and zinc, where miners were given a few years to phase out exports, shipments of nickel ore were cut altogether as of 12 January. Continue reading »
Following on from the sharp fall in the Argentinian Peso last week, the Emerging Markets sell-off has spread to Asia. Mitul Kotecha, head of global equities Asia at Crédit Agricole CIB, says problems in Thailand and upcoming elections in India and Indonesia are making investors uncomfortable, especially now that tapering is causing capital outflows from the region.
A sliding rupiah, slowing economic growth and fast-rising costs are not exactly good news for Indonesian companies selling to the large consumer market, many of which have US dollar debts and US dollar costs.
But the squeeze could be a boon for Japanese, Korean and Western companies who have been looking to buy into Indonesia’s consumer goods sector – and the bankers who advise them. Continue reading »
Maritime piracy has fallen to its lowest level for six years, according to figures released on Wednesday by the International Maritime Bureau (IMB). Overall, the number of actual and attempted attacks is down 40 per cent since Somali piracy peaked in 2011.
But there there are new reasons to be concerned. Piracy is spreading in west Africa and beyond. The number of armed robberies around the coast of Indonesia is at its highest level for 10 years. Continue reading »
While speculation about the US Federal Reserve’s plans to curb its quantitative easing programme drags on, Indonesia’s currency continues to “taper” of its own volition.
On Thursday, the dollar rose to over 12,000 rupiah for the first time since 2009. Confidence in Indonesia’s currency is weak because of the country’s large current account deficit and slowing economic growth, which is at a four-year low. Continue reading »
Nomura has released its Global Annual Economic Outlook for 2014, and its prognosis for Asia is interesting.
The investment bank states that the region’s economic leaders for the coming year will be: Korea, Malaysia and (despite a devastating typhoon) the Philippines. Continue reading »
Amid the feverish speculation over whether Joko Widodo will run for president of Indonesia, it is right to ask what he has achieved in just over a year as the governor of Jakarta.
Walking through the anarchic streets of Jakarta, while avoiding open sewers and choking on the traffic fumes, it does not seem that much has changed. But as Widodo – who is universally known as Jokowi – told the FT in an interview, there is much to do after years of neglect. Continue reading »
While international investors spend their time trudging around the world in search of the next emerging market star, wealthy emerging market residents are often scouring the globe for safe havens for their cash.
It is a conundrum encapsulated by Steen Jakobsen, chief investment officer of Denmark’s Saxo Bank, who visits around 30 different countries a year to take the market pulse and talk to local investors at conferences. Continue reading »
Emerging market stocks are feeling the love again.
Investors who have led the summer stampede out of EM equities are slowly making their way back into once-battered markets like India, Indonesia and South Africa – lured by cheaper asset prices, the delay in Fed tapering and signs of improving EM growth fundamentals.
The MSCI Emerging Markets Index, having plunged by as much as 16.7 per cent between the first week of May and the end of June, has recovered nearly all its losses from this summer. Continue reading »