SINGAPORE: Export Data Craters in August

Both Indian and South Korea markets were out on Friday, limiting the equity update for the region. Both markets return today. Elsewhere, Taiwan flows were positive, marginally bringing the 5 day sum of inflows back into positive territory. On Friday, local equities closed just short of recent highs. The authorities also revised higher the 2025 growth forecast to 4.45% from 3.1% (on Friday Q2 preliminary GDP rose 8%y/y, close to the initial estimates). Tech equity sentiment in the US was softer in Friday trade though, with the SOX down over 2%.  

• Indonesian positive inflow momentum continued on Friday, bringing inflows last week to just over $400mn. This is the best run for a 5 day period in terms of inflows since late Sep last year. Local equities faltered on Friday, but remain close to recent record highs. The budget deficit projection of 2.48% of GDP for 2026 is slightly tighter than this year's (just beyond 2.5% of GDP), and is likely to be welcomed by the market that was fearful of fiscal slippage under Prabowo's Presidency. Indonesian markets are out today.
• Elsewhere Malaysian outflows continued, with 16 straight sessions of outflows by offshore investors. 

Table 1: Asian Markets Net Equity Flows 

Source: Bloomberg Finance L.P./MNI  

The federal government’s productivity round table will be held this week from August 19 to 21 with RBA Governor Bullock scheduled to speak on the first day. In the August RBA press conference, she said that she will speak on how increasing productivity growth improves economic resilience. In terms of data, the focus will be on survey releases.

• Westpac consumer confidence for August is released on Tuesday and may improve following the August 12 rate cut decision. It rose 0.6% m/m in July but remains low given that real disposable incomes are rising and rates are lower.
• On Thursday, preliminary August S&P Global PMIs print. Both services and manufacturing improved in July and the data will be watched to see how growth and prices/costs developed into Q3.
• August Melbourne Institute inflation expectations for August are also published on Thursday. They jumped in June to 5.0% but only eased moderately to 4.7% in July, remaining high compared to previous months.
• RBA Head of Payments Policy Connolly will participate in a fireside chat at the COSBOA National Small Business Summit at 1450 AEST on Tuesday. While at 1200 AEST on Wednesday, Assistant Governors McPhee and Jones speak as part of a panel on the Future of Money.

TYU5 is trading 111-20+, up 0-01+ from its close. 

• The US 2-year yield opens around 3.753%.
• The US 10-year yield opens around 4.316%.
• Fed Jackson Hole Symposium - The Federal Reserve's annual Jackson Hole Economic Policy Symposium takes place over Aug 21-23. While Fed officials and multiple global central bank/policy figures will be in attendance, the focus as always will be the keynote speech by the Fed Chair, with Powell speaking at 1000ET Friday Aug 22 on the "Economic Outlook and Framework Review". Attention will of course mostly be on any nod to a potential September Fed rate cut, but as the speech title indicates, a large portion of his comments will touch on the findings from the Fed's policy framework review.
• (Bloomberg) -- Asset managers broadly added to net long positioning in Treasury futures during the week up to Aug. 12, according to CFTC data. In the long-end there was a decent amount of duration extension in long-bond and ultra-long bond futures from asset managers, along with 10-year note futures. Hedge funds added to net short position in 10-year note futures.
• Yields extended higher on Friday, approaching the pivotal resistance area within the greater 4.10%-4.65% range. The 4.35% area in 10-Year yields should still see demand initially, but the way the market keeps bouncing off levels just below 4.20% will be disconcerting for longs.
• Data/Events: New York Fed Services Business Activity, NAHB Housing Starts