Updates to economic trends in China, Japan, the United States, Eurozone and United Kingdom will dominate the week as markets seek insights into growth momentum amid varying vaccine rollouts and virus infection rates - Photo: Special

JAKARTA (TheInsiderStories) – Good Morning! Updates to economic trends in China, Japan, the United States (US), Eurozone and United Kingdom (UK) will dominate the week as markets seek insights into growth momentum amid varying vaccine rollouts and virus infection rates.

The week also sees interest rate decisions scheduled at central banks in New Zealand, South Korea and Turkey. In Indonesia, the central bank to announces the February’ retail sales survey and export import data in March. In Asia, China’ annual GDP growth rate is set to surge in the first quarter, given the economic slump seen this time last year as the pandemic struck and the economy locked down.

Growth could accelerate from 6.8 percent in the fourth quarter to around 19 percent, though the pace of expansion will likely cool in the remaining quarters of the year. China nevertheless continues to show strong economic expansion, due mainly to its success in controlling fresh outbreaks of COVID-19, with our economic forecasting team pencilling-in 7.8 percent growth for 2021 and a 5.8 percent expansion in 2022.

China trade balance is expected to plunge to US$52.55 billion from previously $103.25 billion. Investors also were anxious to see how shares in Alibaba Holdings (NYSE: BABA) Group Holding Ltd fared after China slapped a record RMB18 billion ($2.74 billion) fine on the e-commerce giant.

Japan’ machinery orders will also come under scrutiny, notably in the hope that stronger factory output growth is helping to offset service sector malaise. In the US, industrial production and retail sales data are expected to show the economy sustaining strong growth momentum midway through the first quarter.

While, the April manufacturing survey data from the New York and Philadelphia Feds, plus University of Michigan consumer sentiment, will give insights into how the economy is faring at the start of the second quarter amid the ongoing vaccine rollout and fresh fiscal stimulus.

Over the weekend, Federal Reserve Chair Jerome Powell said the economy was about to start growing much more quickly, though the coronavirus remained a threat. Data out this week are expected to show US inflation jumped in March, while retail sales is seen surging perhaps even with a double-digit gain.

In Europe, the vaccine rollout has been slow, and further waves of the virus threaten to subdue growth in the second quarter. However, one area of success has been its record manufacturing output growth, the upturn in which looks set to be confirmed by official production data across the region. Consumer price data may show signs of rising price pressures, though core inflation is likely to remain subdued.

In the UK, GDP numbers are expected to show the economy struggling during the lockdown, albeit with the PMI surveys hinting at fresh signs of life as domestic demand is lifted by the successful vaccine roll-out. Its anticipated UK’ economy jump to 0.6 percent from earlier contracted 2.9 percent and the manufacturing production seen to surge to 0.5 percent from minus 2.3 percent.

At the end of last week, Indonesian Rupiah was closed dowm 0.21 percent to 14,565 against the US Dollar and the Jakarta Composite Index (JCI) was slightly corrected by 0.02 percent to the level of 6,070 compared to the previous day. The analysts rated, the Rupiah has been under pressure recently due to the seasonal factor of high corporate demand in April-May and for dividend distribution from multinational companies.

In the country, the role of the central bank in maintaining exchange rate stability will also be scrutinized by market players. The potential for foreign capital inflows also to continue flowing into the bond market in line with the largest concentration of fiscal spending in the US.

In April – June period there will also be an acceleration of the monetary stimulus from the European Central Bank in the Pandemic Emergency Purchase Program. With these various information, in this week, the Rupiah is expected to move in the range of 14,450 – 14,600 and the JCI between 5,800 – 6,300.

Stocks that can be considered for today are PT Bank Central Asia Tbk (IDX: BBCA), PT Bank Negara Indonesia Tbk (IDX: BBNI), PT Gudang Garam Tbk (IDX: GGRM), PT Mayora Indah Tbk (IDX: MYOR), PT Semen Indonesia Tbk (IDX: SMGR), and PT Bank Mandiri Tbk (IDX: BMRI).

-IHS Markit contributed to this briefing

May you have a profitable Week!

Written by Linda Silaen and Editorial Team, Please Read Our News to Get More information about Indonesia