Halister News

--NICK WADHAMS

(Bloomberg) -- Weak global demand means Taiwan’s exports declined for 13th month in a row in Feb., economists’ forecasts suggest, marking longest stretch since period to Oct. 2009.

• Exports fell 11.7% y/y following 13.0% decline in Jan., according to median est. in Bloomberg survey; ests. range from -15.1% to -8.0%; data due at 4pm local time
• Related data may show imports fell 8.3% y/y and trade surplus widened to $3.6b from $3.5b in Jan.: separate surveys
• Finance Minister Chang said on March 3 that Feb. exports fell more than 10% y/y; cited Lunar New Year holidays and Peace Memorial Day long weekend
• Taiwan’s export orders fell 12.4% y/y in Jan., worse than 10.5% decline est. in Bloomberg survey
• South Korea’s exports declined 12.2% y/y last month, extending run of negative prints to 14 months, data released March 1 showed

(Bloomberg) -- China raises yuan fixing to strongest level since January after NPC set this year’s GDP growth target at 6.5%-7.0% and widened budget-deficit goal to 3% of GDP from 2.3%; data today will show FX reserves slipped to $3.19t in February, lowest level since Dec. 2011, according to median estimate of economists in Bloomberg survey.

• Yen steady against dollar; Japan’s official reserve assets rose to $1.254t in February from $1.248t in January; some government departments studying impact of delay in tax increase: Reuters
• U.S. Treasuries fall, with yield on 10-year bonds rising 2 bps to 1.892% in Asian trading after non-farm payrolls for February beat forecast and wages fell unexpectedly
• Won advances for seventh day; Seoul Economic Daily says Kim Joo Hyun, former head of Korea Deposit Insurance, and Suh Young Kyung, BOK Deputy Governor, are among potential candidates for central bank board; North Korea warns against US-South Korea military exercises, while Yonhap says South to announce own sanctions against North
• Ringgit rises to highest level since August; PM Najib said yesterday his policies have supported growth and his government has the mandate to lead
• Baht snaps three-day advance; Thailand plans to spend around 1.8t baht ($50.7b) on 20 major infrastructure projects by 2022, Nikkei reports; SEC proposes tougher insider-trading penalties, the FT reports, citing Secretary-General Sucharitakul
• Taiwan’s dollar advances; data today will show island’s exports fell less in February than a month earlier and trade surplus widened to $3.55b from $3.51b: Bloomberg survey; Taiwan to let banks check corporate derivative trading: EDN

(Bloomberg) -- Shrinkage of China’s FX reserves likely to have slowed in Feb. thanks to stabilization of yuan, better sentiment on the currency and valuation effect, analysts say.

• Reserves likely fell $44b to $3.18t in Feb., according to average est. in Bloomberg survey; would be fourth monthly drop in row, though pace moderating from -$99b in Jan.; data due today
• USD/CNY down 0.34% to 6.5540 last month
• Average CNH-CNY spread at 1 pip last month vs 417 pips in Jan.
• Dollar Index dropped 1.4% to 98.211 in Feb.

• UBS economists including Ning Zhang:
  • Capital outflows likely eased with more stable exchange rate, reflected by drop in onshore yuan spot trading volume: $245b in Feb. from $456b in Jan.
  • Exchange-rate movements likely resulted in positive valuation effect of more than $15b
  • Perhaps some downward pressure on reserves from surge in overseas tourism during Lunar New Year holidays
  • Forecasts $30-40b drop in reserves

• Zhou Hao, Singapore-based economist at Commerzbank:
  • Yuan stabilization suggests FX reserves likely less changed than previous months
  • Not so much FX purchasing activity last month, cushioning reserves and reducing capital outflows
  • Fewer working days in Feb. due to Lunar New Year holiday
  • Forecasts Feb. reserves at $3.2t

• CICC said in note last month FX reserves may rise for first time since Oct. on dollar weakness, lower trading volume and capital control measures

(Bloomberg) -- Five-year credit-protection costs for Malaysia fell 13 bps last week to 164 bps, lowest daily close since Aug. 10, according to CMA New York data.

• USD/MYR 1-month NDF slid 1.7% to 4.0613, lowest since Oct. 9, after Friday’s U.S. jobs data

(Bloomberg) -- JPMorgan lowered year-end forecast for 10-year treasury yields to 2.15% from 2.45%, according to March 4 note.

• Revision driven by two separate, though related factors:
  • As investor risk appetite remains low, requiring an unlikely decisive improvement in both the domestic and global macro outlook in order to change sentiment in the next few months
  • Recent curtailment of growth expectations and growing investor concern as to how long current expansion will last
• Expects term premium to stay more depressed than previously expected