Chinese vow of stimulus gives new impetus to risky assets

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(More Bank) – Emerging market equities and currencies rebounded after two weeks of losses, as the weak US dollar and China's willingness to continue supporting the economy overcame worries about global growth prospects. China's willingness to reduce the value-added tax and statements by US Federal Reserve Chairman Jerome Powell that interest rates may remain unchanged have also sparked interest in risky assets.

Below you will find a summary of emerging market information and highlights for the week ending March 15th.

Strong points:

A meeting between President Donald Trump and President Xi Jinping for the signing of an agreement ending their trade war will not take place this month and is expected to take place in April at the earliest, said three people aware of the problem, said the governor of the People's Bank of China, Yi, governor Yi. The two sides reached consensus on many crucial issues, said Trump's chief trade negotiator. The United States must retain the opportunity to increase tariffs on imports from China, to ensure that Beijing abides by the pact. China will cut the value-added tax as of April 1 and fight the economic downward pressure with higher tax cuts and taxes this year, Premier Li Keqiang said at from a press briefing after the closing of the National People's Congress. Li also said the country would depend on markets and use tools such as bank reserve requirements. Powell's comments on rates appeared the very week that a report showed that a key measure of underlying inflation in the United States had unexpectedly eased in February, as because of falling prices of cars and prescription drugs. Dr. Kim Jong Un of North Korea will soon decide to stop negotiations on nuclear disarmament with the United States, the latest sign of spin-off from his summit with President Donald Trump last month, reported AP The Philippine peso was the worst performer of the week as a central bank Governor Benjamin Diokno said the authorities would not intervene in the foreign exchange markets as long as the currency remains within a reasonable range, adding that "for the moment, this is part of this band". He also recalled that it was possible to relax monetary policy. the week, helped by a rally on Friday after price rises were faster than expected, led the central bank a number of measures to tighten monetary policy

Asia:

China is committed to maintaining targeted stimulus despite the pressure of unemployment China still has some room to reduce the amount of money reserves banks, but it is much smaller than in previous years , said the governor of the PBOC, Yi, to the country 's economic slowdown during the first two months of the year. In the current year, with industrial production recording a smaller than expected increase, the central bank and the exchange control authority will reduce the risk of "gray rhino" in key areas and prevent abnormal fluctuations in financial markets, according to a statement from the central bank. The first two months of this year, according to the central bank, North Korea may be preparing to launch a missile or rocket in the near future, according to satellite images of the activity in the country, reported the channel American radio NPR, while national media announced the world blames the United States for ending the Hanoi summit without an agreement Trump's envoy for North Korea called the United Nations Security United Council members must remain united to put pressure on Kim's government to abandon its nuclear weapons. In February, the unemployment rate in South Korea fell to its lowest level in eight months and the economy has created the largest number of new jobs since last January. The Indian rupee was among the top performers last week; The nation will unveil the election results on May 23, after six weeks of voting, which will determine whether Prime Minister Narendra Modi will get a second term. India will continue to implement economic reforms, regardless of the election winner, said a key government advisor. The central bank could buy 1.7 trillion rupees ($ 25 billion) in bonds during the year beginning April 1, according to a More Bank survey of traders and economists, against a record estimated at 3 trillion rupees spent during this fiscal year The central bank announced its intention to inject 5 billion trillion cash through a 3-year dollar / rupee swap auction. The auction will take place between 9:30 am and 11:00 am, Mumbai time, March 26th. Consumer prices rose 2.57% in February over last year. Lower inflation in India puts central bank in a position to support economic growth, former governor Bimal Jalan said Bank of Thailand's odds in March review are low, committee member says Monetary Policy – Global Abandonment of Tightening Monetary Policy Complicates Bank of Thailand's Rising Benchmarking Task Lead Director, Don Nakornthab, Says Thailand Could Sell More Goods After US United have decided to remove preferential tariff treatment granted to India and Turkey, according to a Ministry of Commerce official, Pimchanok VonkorponBank Indonesia is ready to buy government bonds in the market, aimed at Nanang Hendarsah, executive director of monetary management, President Joko Widodo seems ready to secure his foreign outflows A secon In a 17 April election, the Kompas newspaper reported on Sunday, citing its excellent results in a poll of voters. The country recorded its first trade surplus in five months in February, as imports collapsed. Growth in Malaysian industrial production slowed to 3.2% in January. The Philippine economy According to the Secretary of State for Economic Planning, Ernesto Pernia, exports fell for a third month in January, while imports rose unexpectedly. Foreign direct investment is expected to remain broadly the same in 2018, the deputy governor of the central bank, Diwa Guinigundo, said:

EMEA:

Turkey's gross domestic product fell by 2.4% qoq from the previous three months, correcting for seasonal variations, thus causing the economy's first recession in a decade. The European Parliament urged the EU to suspend accession negotiations with Turkey because of the democratic regression in the countryThe ruble was among the most successful; The balance sheet of the Russian bond auction lasted only two weeks, while the greedy investors of yield imposed during the last unlimited sale of debts of the Ministry of Finance. They again ruled out the risk of prolonged sanctions imposed by the United States. The government has outsourced a fraudulent scheme because it is discussing with creditors the restructuring of loans, said Prime Minister Carlos Agostinho do Rosario. The inflation rate in Romania rebounded to its lowest level since 2017 to exceed the top of the central bank's target range. Increases in short-term borrowing costs Czech inflation exceeded analyst and central bank expectations for a second consecutive month, bolstering arguments for policymakers to resume rising interest rates Benin, whose GDP is about 10 billion, prepares a series of meetings with potential takers of a first sale of Eurobonds, according to a person familiar with the case According to investors who attended meetings with Treasury officials in London, Africa may have to pay a premium if it solicited international bond markets before a review of its credit rating later this month and elections in May. Ghana could also prepare to issue bonds Lenders in the UAE will need to lengthen the maturity of home loans, according to the head of the country's bank, the property market showing no signs of recovery Moody's Investors Service, which has degraded the rating of Oman The sultanate run out of money will not need a bailout similar to the one that Bahrain received during the 12 to 18 next few months. Egypt's annual urban inflation has accelerated for a second month, complicating the trajectory of the central bank after its first interest rate cut for almost a year

Latin America

Argentina's central bank raised its 7-day note stock to more than 1 trillion pesos, its highest level since their bid for the first time in January 2018, absorbing pesos to control inflation. peso volatilityBrazil's retail sales rose record-breaking since August in January, rebounding after a deep slowdown at the end of 2018 and helping to balance the economic outlook after the disappointing data on industrial production posted earlier in the week . Shooting at a public school in Sao Paulo 10 dead people renewed the debate on President Jair Bolsonaro's measures in favor of easing gun control. The new head of the central bank, Roberto Campos Neto, has stressed the need for the monetary authorities to have formal autonomy conferred by the law, saying that it would better help policymakers to control inflation. has set up the first congressional committee to consider the pension bill, an essential step towards its approval Exico's president, Andrés Manuel Lopez Obrador, denied an undersecretary who had hinted that a controversial refinery project would be delayed, believing that the construction was on schedule. Industrial production fell less than expected in January.The Mexbol stock index, which recorded the largest losses in the world during the six brought least an evaluation measure at the lowest level in eight years

– With the help of Colleen Goko, Selcuk Gokoluk, Netty Ismail and Brendan Walsh.

To contact the reporters on this story: Yumi Teso in Bangkok at yteso1@More Bank.net, Aline Oyamada in Sao Paulo at aoyamada3@More Bank.net

To contact the editors in charge of this story: Tomoko Yamazaki at tyamazaki@More Bank.net, Philip Sanders at psanders@More Bank.net, Dana El Baltaji at delbaltaji@More Bank.net, Shamim Adam

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