• UK activity remains buoyant: we forecast GDP growth of 0.8-0.9% q/q in H1-2014
• BoE policy makers are split over how much slack remains - and hence, at what point rates should rise
• Near-term inflation pressures have eased, but wage growth i...
AUM of foreign investment funds has hit USD 20bn, almost double the peak of Kimchi funds in 2010
• We expect FIFs’ AUM to grow further amid the postponement of infra-projects; this may keep THBFIX low
• The economic outlook is weak given political...
• Top 3 data/events
• New Zealand – RBNZ will likely hike the cash rate again, to 3.00%
• Germany – IFO to show firm fundamentals dampened by shaky outlook
• US – Markit PMI survey may show ongoing manufacturing expansion
• Market focus
• ETF: Focus is on precious metals, notably palladium funds; gold flows are bearish on positive US data
• CFTC: The uptick in managed-money flows was led by energy sector; Arabica net spec is overextended...
Our survey shows that SMEs are less optimistic on Q2-2014 than they were a quarter ago
• The 50.8 reading is still consistent with business expansion; margin concerns have re-emerged
• All three major industry sub-indices are above 51.0, boding we...
The Central Bank of Sri Lanka kept policy rates unchanged at its 22 April meeting
• Upside risks to inflation increase the likelihood that it will keep rates on hold for longer
• Private credit growth continues to slow, while external sector perfo...
We update the signals from our RV model for swaps based on a PCA framework
• New RV signals: GBP 3Y/10Y steepener and KRW 5Y/10Y steepener
• Of the 20 closed signals since we launched our RV model, 15 would have delivered profits, 5 losses...
Sri Lanka’s rice harvest will likely be affected by the ongoing drought
• Food inflation should rise significantly during the summer; we expect some impact in the winter, too
• If the El Niño effect materialises, headline inflation could rise to...
Latest Taiwan data shows growth momentum picking up and inflation edging higher
The recent student protest is likely to have only a minimal impact on the near-term growth outlook
Policy makers may consider shifting to a neutral monetary stance and...
• Despite differences of opinion, the AKP election victory is viewed as conducive to stability
• The political roadmap may be clearer, but this does not rule out more market-moving political noise
• We reaffirm our GDP growth call of 2.2% for 201...
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Top 3 data/events
• Japan – Trade deficit likely remained given import re-acceleration
• Taiwan – Overseas demand likely supported export orders
• US – Yellen sticks to her script in NY speech
• Market focus
• China’s Q1 GDP slowed to 7.4% y/y as credit and housing sales decelerated...
The world economy is in transition. Global growth rates are picking up, but transition means elevated risks and volatility.
In terms of global implications, all eyes will be on the US and China, with the US normalising monetary policy and China rebalancing its economy.
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