MALAYSIA: Country Wrap: Exports Miss Whilst Surplus Rebounds in February
Mar-20 05:53
- Malaysia produced a significant increase in its trade surplus rising to MYR12.6bn, from MYR3.66bn prior. Both imports and exports from the US remain resilient and in line, indicating with a modest surplus of MYR7bn. Malaysia however recorded a MYR9bn trade deficit with China, with exports down -8.1% and Imports rising by +13.14%. Electronic exports were up +18.1% in February and imports up +23.1% y/y. Petroleum products were a drag on the result declining -12.3% y/y. Overall exports rose +6.2% versus forecasts of +6.5%, following January's result of +0.3%. Imports rose +5.5% versus forecasts of +9.6%, following January's result of +6.2%. The growing concern for the Central Bank will be to watch closely consumer behaviour and whether the declining import data is pointing to a softer domestic demand outlook. (source: MNI – Market News)
- Palm oil prices are set to rise on hopes that China and India may resume purchase falling successive months of declining prices (source: BBG).
- Malaysia’s FTSE Bursa Malaysia has fallen again today by -0.35%.
- MYR: following the FED’s hold, Asian currencies have performed well today with the ringgit gaining +0.21% to be at 1,460.10
- Bonds: another very strong day for bonds with the MGS 10YR down -3bps to 3.75%. The last time it touched that level was October 2024.
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CHINA: Country Wrap: Xi Courting the Entrepreneurs.
Feb-18 05:42
- Guangdong province beat Shanghai this year to once more become the leading contributor to China’s personal income tax revenue, according to data compiled by Yicai. Guangdong earned CNY95 billion (USD13.1 billion) in individual income tax revenue in 2024, up 0.4 percent from the previous year. Shanghai, which ranked first last year, collected CNY94.6 billion, down 0.7 percent in the period. (source: Yicai)
- Xi Jinping, general secretary of the Communist Party of China (CPC) Central Committee, on Monday urged efforts to promote the healthy and high-quality development of the country's private sector. Xi made the remarks when attending a symposium on private enterprises, where he delivered an important speech after listening to representatives of private entrepreneurs. The private sector enjoys broad prospects and great potential on the new journey in the new era. It is a prime time for private enterprises and entrepreneurs to give full play to their capabilities, Xi said. (source: Xinhua)
- With the Hang Seng leading the way, optimism is abounding in China’s key indices with the Hang Seng up +1.90%, CSI 300 +0.29%, Shanghai +0.12% and Shenzhen going the opposite way -0.34%.
- CNY: Yuan Reference Rate at 7.1697 Per USD; Estimate 7.2570
- Bonds: A weak day in China bonds with the CGB10yr at 1.72% (+3.5bps)
AUDNZD: AUD/NZD Testing ytd Highs
Feb-18 05:23
- Following the hawkish cut from the RBA, the AUD/NZD is testing recent highs, we have made session highs of 1.1141 vs last weeks ytd highs of 1.1149, a break here would open a move to Nov highs of 1.1180.
- The AU-NZ 2yr swap has jumped 8bps to 44bps.
JGBS: Bear Steepener After Poor 20Y Auction
Feb-18 05:20
JGB futures are sharply weaker and at session lows, -28 compared to settlement levels.
- “The Bank of Japan should continue raising interest rates if data allows to maintain room for policy adjustments later, according to former Bank of Japan Deputy Governor Hiroshi Nakaso” (per BBG)
- The market remained steady through to the lunch break but dropped sharply after today’s 20-year auction revealed weak demand across key metrics.
- First, the auction low price fell well short of dealer forecasts. Secondly, the cover ratio declined to 3.06x from 3.79x in the previous auction. Lastly, the auction tail widened significantly to 0.55 from 0.04, signalling a notable deterioration in demand.
- Cash US tsys flat to 4bps cheaper in today’s Asia-Pac session, with a steepening bias following yesterday’s holiday, intensifying the sell-off at the long end of the JGB curve.
- Cash JGBs are flat to 5bps cheaper across benchmarks, with the benchmark 20-year leading the way.
- Swap rates are flat to 2bps higher, with swap spreads mixed.
- Tomorrow, the local calendar will see Trade Balance, Core machine Orders and Tokyo Condominiums for Sale data alongside BoJ Rinban Operations 1-10-year and 25-year+ JGBs.
