The week commences with a focus on the People’s Bank of China’ policy rate meeting, with clues sought as to when some of the emergency pandemic support will be unwound - Photo: Special

JAKARTA (TheInsiderStories) – Good Morning! Data releases in the coming week will be scrutinized eagerly for clues as to the length and depth of recessions caused by the COVID-19 pandemic, most notably the flash PMI updates for the US, Europe and Japan, due out on Tuesday.

The week will also see updated forecasts from International Monetary Fund, while monetary policy decisions are due in New Zealand, the Philippines, Thailand, Hungary and the Czech Republic. The PMI surveys provided an early indication that the worst of the economic impact from the virus outbreak appears to have hit in April, with the global PMI staging a record rise in May, albeit remaining worryingly weak by historical standards.

With lockdowns having increasingly eased into June, further gains in the PMIs will be needed to corroborate growing expectations that economic recoveries are gaining traction. In addition, US data releases include durable goods orders, home sales, house prices, personal spending, income and prices data, the University of Michigan consumer sentiment survey and regional manufacturing surveys.

In Asia Pacific, flash PMI data for Japan and Australia are accompanied by some key official releases including China’ industrial profits, Vietnam GDP, retail sales in Japan as well as industrial production numbers for Singapore, Thailand, Taiwan and Vietnam.

For Europe, the flash PMI data for the Eurozone, Germany, France and the UK are supplemented by sentiment surveys from the European Commission, which include the closely watched IFO survey for Germany. In Indonesia, finance minsiter Sri Mulyani Indrawati together with Bank Indonesia (BI) governor Perry Warjiyo and head of BAPPENAS Suharso Monoarfa will formulates the 2021 macro assumption with parliament.

On Friday, Indonesian Rupiah closed up 0.10 percent to 14,100 against the US Dollar and the Jakarta Composited Index (JCI) dropped 5.01 percent to 4,895,78 compared to prior day. For this week, according to analysts, no variable has been able to support the financial markets amid increasing corona cases in Indonesia.

Based on data from the task force, the number of positive confirmed cases of COVID-19 patients increased by 862 on Sunday and the previous day increased by 1,226 people. Indonesia’ position which has now overtaken Singapore as the virus epicenter in Southeast Asia.

Coupled with a decrease in the benchmark rate the local currency will weaken in the second half of 2020. Earlier, Warjiyo said the policy of maintaining the benchmark rate in May actually took into account exchange rate stability.

But, HSBC expects that the Rupiah could weaken to as low as 15,200 over the Greenback by the end of 2020. While, Rabobank projects the currency to weaken to the level at 15,237 by the end of the upcoming third quarter. However, BI estimates that in 2020, Rupiah will be in the range of 14,000 – 14,600 versus US Dollar.

For today, shares to be watch are PT Astra Agro Lestari Tbk (IDX: AALI), PT Vale Indonesia Tbk (IDX: VALE), PT Waskita Karya Tbk (IDX: WSKT), PT Mitra Adiperkasa Tbk (IDX: MAPI), PT Adaro Energy Tbk (IDX: ADRO), PT Indofood CBP Sukses Makmur Tbk (IDX: ICBP), PT Indofood Sukses Makmur Tbk (IDX: INDF), PT Kalbe Farma Tbk (IDX: KLBF), PT Ace Hardware Tbk (IDX: ACES), PT Bank Rakyat Indonesia Tbk (IDX: BBRI), PT AKR Corporindo Tbk (IDX: AKR), and PT Gudang Garam Tbk (IDX: GGRM).

-IHS Markit contributed to this briefing

May you have a profitable Week!

Written by Linda Silaen and TIS Intelligence Team, Please Read Our Insight to Get More information about Indonesia