Emerging-market stocks and currencies rose to an 18-month high as the year looked to be coming to a close on a positive note for riskier assets.
At the end of the Christmas week, a rally in technology shares around the world gave a final boost to equities, already buoyed by the prospect of a phase-one trade deal between the US and China.
In the latest sign of optimism, investors added a record $4.2bn to emerging-market exchange-traded funds. The following is a roundup of emerging-markets news and highlights for the week ending December 27.
Highlights: China’s government said it will cut import tariffs for goods, pharmaceuticals, paper products and some high-tech components starting from January 1.
Policy makers will unveil a three-year action plan in early 2020 on the reform of state enterprises, aiming to improve the performance of the sector and create world-class industry champions, according to state-owned newspapers.
China’s imports of US soybeans rose to the highest in 20 months in November after more American cargoes cleared customs ahead of the signing of a partial trade deal in January.
The phase-one trade agreement has created a favourable environment for an overall balanced foreign-exchange market in China in the next year, said Lu Lei, deputy head of State Administration of Foreign Exchange.
Asia: Profits at Chinese industrial enterprises rose in November as factory-gate deflation eased and domestic demand improved.
Industrial profits climbed 5.4% in the month from a year earlier, after three months of declines including October’s record 9.9% slump. China is willing to open its financial and health-care services sectors to foreign investment, including the gradual removal of ownership limits, Chinese Premier Li Keqiang said at a summit with Japanese Prime Minister Shinzo Abe and South Korean President Moon Jae-in in Chengdu.
Among 3,200 bankers surveyed by the Chinese central bank, 15% think monetary policy is loose, 2 percentage points higher than in the third quarter.
The Ministry of Industry and Information Technology forecast 2019 industrial output growth at about 5.6%. Chinese policy makers will unveil a three-year action plan in early 2020 on the reform of state enterprises.
China’s economic performance improved in December for the first time in eight months, according to a group of earliest-available indicators compiled by Bloomberg.
South Korea trade figures for December show monthly exports may decline less than 10% for the first time since May, another sign the global manufacturing slump may be ending.
The government finalised its 2020 budget allocation plan, with a focus on increasing spending in the first half to facilitate economic recovery. Bank of Korea said it will strengthen its study and analysis of monetary policy tools other than interest rates.
The leaders of Japan and South Korea signalled they wouldn’t let relations spin out of control even as they made little progress in resolving disputes that have plagued relations.
India needs to consolidate its finances by curbing expenditure and boosting taxes to trim its debt, the International Monetary Fund said. India’s central bank bought Rs100bn ($1.4bn) of benchmark 10-year bonds while selling Rs68.25bn of 2020 debt as it sought to cheapen longer-term borrowing.
The Reserve Bank of India plans to buy another Rs100bn of 6.45% 2029 bonds via auction today.
Thailand will narrow its inflation target for next year as consumer-price growth remains subdued. The central bank’s new goal is to keep annual headline inflation within a 1%-3% range, compared with 1%-4% previously. Thai exports fell the most since April 2016 in November, dropping 7.4% year on year.
The Fiscal Policy Office expects exports to expand 2.6% next year on an improving trade war outlook. The economic growth outlook of 2.8% next year is “disappointing” and policy makers are doing what they can to curb excessive gains in the currency, governor Veerathai Santiprabhob said.
The nation is set to spend 1tn baht ($33bn) on infrastructure in 2020 through 2022. The Bureau of the Budget, the Finance Ministry, the National Economic and Social Development Council and the Bank of Thailand all approved the 2021 budget framework, including a deficit of 523bn baht.
Bank of Thailand is directly in charge of curbing baht strength, Finance Minister Uttama Savanayana said.
Philippine Bureau of the Treasury will offer 420bn pesos ($8.3bn) of bills and bonds in the first quarter, nearly double the 220bn pesos this quarter as it revives the weekly sales of short-term debt, according to a memo by Treasurer Rosalia de Leon.
President Rodrigo Duterte signs law extending the availability of this year’s 3.66tn-peso budget until 2020, according to a copy of a document released by presidential palace.
Taiwan plans to buy more US agricultural goods along with other items in the next few years to reduce its trade surplus, Deputy Minister of Economic Affairs Wang Mei-hua said.
Sri Lanka kept its benchmark interest rate unchanged for a third meeting as risks to economic growth waned and inflation stays subdued.
South Africa published a long-anticipated draft of oil and gas legislation that will give the state a 20% carried interest in exploration and production rights, with the aim of increasing development of the industry.
Serbia plans to tap international bond markets to pay for projects designed to double its economic growth rate under a new plan as the country exits years of austerity, according to Finance Minister Sinisa Mali.
Uzbekistan’s ruling party won the first parliamentary elections held since President Shavkat Mirziyoyev came to power pledging to open up central Asia’s most populous nation.
Ivory Coast issued an arrest warrant for opposition presidential candidate Guillaume Soro on the threshold of an election year. Uganda expects economic growth to slow over the next two fiscal years while remaining about 6%, as the cash-strapped government makes budget cuts before long-awaited oil exports begin later in the decade.
Latin America: Brazilian President Jair Bolsonaro was discharged from hospital after recovering from a fall at the presidential palace that affected his memory. Foreign investors piled into Brazil’s main stock exchange-traded fund the previous week amid signs economic growth is finally beginning to pick up Brazil’s government will send a bill to Congress to strengthen protections for minority shareholders in the wake of a corruption scandal at Petrobras.
Second-tier inflation index unexpectedly slowed, reinforcing market perception that the recent pressure on prices led by food costs was transitory.
from Gulf Times https://ift.tt/2ZAK4Zw
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