JAKARTA (TheInsiderStories) - Good Morning! Interest rate decisions are scheduled at central banks in Indonesia, Eurozone, Canada, and Russia. In this week which also sees the publication of flash Purchasing Manager’ Index (PMI) surveys covering more than half of the world’ economic output.
Other notable releases include industrial production, trade and inflation numbers of Japan, United Kingdom (UK) labour market, retail sales, state borrowing and inflation statistics, plus Eurozone bank lending and confidence surveys. The United States (US) sees jobless claims and homes sales updates.
Early indicators of economic performance at the start of the second quarter are provided by April’ flash PMIs, covering both manufacturing and services. The March data showed the US outperforming among the largest developed economies, though growth bounced back in the UK and eurozone leaving only Japan in decline.
The strength of the European PMIs surpassed all economists’ expectations, according to polls, as business activity surged in response to brightening outlooks. However, growth disparities reflected differing COVID-19 containment measures, notably hitting service sector growth in Japan, as well vaccine roll-out progress.
The latter has lifted confidence most notably in the US and the UK, though its clear that stimulus measures are also playing a key role in the US. A more worrying feature of the PMIs is the recent spike in prices.
Prices globally have been rising at the sharpest rate for over a decade, linked to a combination of near-record supply delays and surging demand as economies reopen, pushing bond yields higher. The PMI survey data follow Wednesday’ ECB rate setting meeting.
No further action is anticipated until at least June after policymakers stepped up the pace of asset purchasing at their last meeting in response to rising bond yields, especially as the minutes showed disagreement on the action. But some policymakers have also grown concerned over the slow vaccine roll-out and the reliance on government support schemes.
The Bank of Canada meanwhile meets amid signs not only that the recovery heating up, the PMI having hit a record high, but so too is the housing market. However, no change in policy is expected anytime soon. This week’ rather light economic calendar also features the latest data on initial jobless claims, which fell to a new pre-pandemic low last week.
In Asia, Japan’ exports posted their strongest growth in more than three years in March, led by a surge in China-bound shipments. Ministry of Finance data showed exports surged 16.1 percent in March from a year ago, marking the steepest rise since a 16.2 percent gain in November 2017 and followed a 4.5 percent contraction in February.
End of last week, Indonesian Rupiah closed up 0.34 percent to 14,565 per US Dollar and the Jakarta Composite Index (JCI) rose by 0.11 percent to 6,086.27 from a day before. The analysts rated, China’ GDP will have a direct impact on Indonesia’ economic growth.
This is a positive signal that domestic economic recovery can be carried out quickly. Even the estimated GDP in the second quarter of 2021 at the 7 percent level is likely to be realized. He explained that China’ economic growth will immediately be felt on the export side, especially demand from the bamboo curtain country which is believed to automatically increase.
This will certainly help Indonesia’ exports to China, so that Indonesia’s trade balance has the potential to be a surplus for the next few months. On the other hand, the yield on US 10-year bonds continued to decline as investors became increasingly convinced that the Fed would continue its monetary support.
Witth these various information, Rupiah is estimating move in the ranga 14,545 - 14,600 and the JCI between 5,950 - 6,123. Stocks that can be watched today are PT Indofood CBP Sukses Makmur Tbk (IDX: ICBP), PT Bank Central Asia Tbk (IDX: BBCA), PT Telkom Indonesia Tbk (IDX: TLKM), PT Astra International Tbk (IDX: ASII), PT Bank Negara Indonesia Tbk (IDX: BBNI), PT Gudang Garam Tbk (IDX: GGRM).
May you have a profitable week!
Written by Linda Silaen and TIS Intelligence Team, Please Read Our Insight to Get More information about Indonesia
