MALAYSIA: Country Wrap: GDP Up, Exports Very Weak
Jul-18 05:33
- In the GDP preview, we worried whether the BNM were cutting rates to head off a material decline in GDP. Whilst that concern didn't eventuate with 2Q GDP rising to +4.5% (est. +4.2%; prior +4.4%) where the real surprise came was in the export data release. A strong result across most sectors with Agriculture +2% YoY; mining -7.4% YoY; manufacturing +3.8% YoY, Construction +11% YoY; services +5.3% YoY. Exports seemingly collapsed in June, contracting -3.5% for the worst monthly result in 18 months. Malaysia has not finalized a trade deal and after the surge in April of exports ahead of tariffs, the data suggests that exporters may now be struggling. Exports to the US expanded +4.7%, after +16.1% in May but contracted -9.3% to China. In more worrying signs, imports slumped also in what some point to being a weakening of the domestic market. At a time when the White House if focused on trade, having an outsized positive Trade balance is not a great headline and the MYR8.59bn surplus is big enough to draw attention. (source MNI)
- Maybank Investment Bank Bhd (Maybank IB) expects Bank Negara Malaysia (BNM) to keep the overnight policy rate (OPR) at 2.75 per cent for the rest of the year after the 25 basis points reduction on July 9. Based on the briefing following last week’s monetary policy committee meeting, Maybank IB’s group chief economist, said the investment bank believes that BNM is likely adopting a “one-cut-and-done” approach to rate cuts. “At the moment, we don't expect any more cuts from BNM. I know they have flagged the downward revision to gross domestic product (GDP) growth at the end of this month. Currently, the official growth forecast for this year is 4.5 - 5.5 per cent. (source The Star)
- The FTSE KCI index is up modestly today by 0.35% but unless it rallies strongly into the close is on track to be lower by just over -0.60%.
- The Ringgit has had a very quiet week rising +0.06% and +0.09% for the week at 4.2460
- Bonds have had a minor sell off for the week with the MGS10yr +3bps for the week at 3.45%
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LOOK AHEAD: UK Timeline of Key Events (Times BST)
Jun-18 05:23
| Date | UK | Period | Event |
| 18-Jun | 0700 | May | Consumer inflation report |
| 19-Jun | 1200 | Bank Of England Interest Rate | |
| 20-Jun | 0001 | Jun | Gfk Monthly Consumer Confidence |
| 20-Jun | 0700 | May | Public Sector Finances / Retail Sales |
| 20-Jun | 1630 | Q3 | BOE to announce Q3 APF sales schedule |
| 23-Jun | 0930 | Jun | S&P Global Flash PMIs |
| 24-Jun | 1030 | ---- | BOE Green On CB Balance Sheet Mgmt |
| 24-Jun | 1100 | Jun | CBI Industrial Trends |
| 24-Jun | 1435 | ---- | BOE Ramsden At Barclays-CEPR MonPol Forum |
| 24-Jun | 1500 | ---- | BOE Bailey At Lords Econ Affairs Committee |
| 24-Jun | 1650 | ---- | BOE Breeden At UK Finance Digital Innovation Summit |
| 25-Jun | 0001 | Jun | Brightmine pay deals for whole economy |
| 25-Jun | 0945 | ---- | BOE Lombardelli At BOE MonPol Conference |
| 25-Jun | 1000 | ---- | BOE Pill On Panel At BOE MonPol Conference |
| 25-Jun | 1330 | ---- | BOE Lombardelli Chairs Riksbank's Breman Speech At BOE MonPol Conf |
GBPUSD TECHS: Corrective Pullback Extends
Jun-18 05:18
- RES 4: 1.3800 Round number resistance
- RES 3: 1.3757 1.618 proj of the Feb 28 - Apr 3 - 7 price swing
- RES 2: 1.3681 1.500 proj of the Feb 28 - Apr 3 - 7 price swing
- RES 1: 1.3632 High Jun 13 and the bull trigger
- PRICE: 1.34441 @ 06:17 BST Jun 18
- SUP 1: 1.3415 Low Jun 17
- SUP 2: 1.3350 50-day EMA
- SUP 3: 1.3237 Trendline support drawn from the Jan 13 low
- SUP 4: 1.3140 Low May 12 and key support
A sharp sell-off in GBPUSD Tuesday resulted in a breach of support at the 20-day EMA, at 1.3496. The latest move down is considered corrective and key trend signals remain bullish. The next important support lies at 1.3350, the 50-day EMA. On the upside, the key resistance and bull trigger has been defined at 1.3632, the Jun 13 high. A break of this hurdle would confirm a resumption of the primary uptrend.
LOOK AHEAD: Eurozone Timeline of Key Events (Times BST)
Jun-18 05:18
| Date | Time | Country | Event |
| 18-Jun | 0830 | EU | ECB Elderson At SRB Legal Conference 2025 |
| 18-Jun | 0900 | EU | EZ Current Account |
| 18-Jun | 1000 | EU | HICP (f) |
| 18-Jun | 1600 | EU | ECB Lane At Macroprudential Conference |
| 18-Jun | 1900 | EU | EC de Guindos at Osservatorio Permanente Giovani |
| 19-Jun | 0830 | EU | ECB's Lagarde On Economic and Financial Integration |
| 19-Jun | 1000 | EU | Construction Production |
| 19-Jun | 1045 | EU | ECB de Guindos On Eurozone Economic Outlook |
| 19-Jun | 1130 | EU | ECB Lagarde Keynote At Economic Integration Conference |
| 19-Jun | ---- | EU | ECB Cipollone At Eurogroup Meeting |
| 19-Jun | 1700 | EU | ECB Lagarde At Financi'Elles event |
| 20-Jun | 0700 | DE | PPI |
| 20-Jun | 0745 | FR | Manufacturing Sentiment |
| 20-Jun | ---- | EU | ECB de Guindos at ECOFIN Meeting |
| 20-Jun | 1500 | EU | Consumer Confidence Indicator (p) |
| 23-Jun | 0815 | FR | S&P Global Flash PMI (p) |
| 23-Jun | 0830 | DE | S&P Global Flash PMI (p) |
| 23-Jun | 0900 | EU | S&P Global Flash PMI (p) |
| 23-Jun | 1400 | EU | ECB Lagarde At ECON Hearing |
