Alvin Liew Francis Tan Victor Yong [email protected] [email protected] [email protected]

Global Economics & Markets Research Email: [email protected] URL: www.uob.com.sg/research

Friday, 19 May 2017 Weekly Outlook

22 – 26 May 2017

SINGAPORE Singapore’s calendar will be most busy this week for May with the April CPI data (23 May) and April industrial production (26 May) while the final print for 1Q 2017 GDP (25 May) is expected to be revised higher to 2.7-2.8% (from the prelim 2.5%).

KEY ASIAN ECONOMIES Friday (19 May) focus will be on Malaysia’s 1Q 2017 GDP & Iran’s elections while South Korea will give the first indication for May trade outlook with release of the first 20 days export and import data on Sunday (21 May). After a busy week with the “Belt and Road: 2017 Summit” in Beijing (14-15 May) and several key April data, things for China will wind down this week with just April leading index (22 May) and April industrial profits of note (Sat, 27 May). But the key data focus in Asia will be the monetary policy decisions of Bank of Thailand (24 May) and Bank of Korea (25 May) although no change is expected from both. There is a lot of trade-related data this week including Taiwan’s April export orders (22 May), New Zealand April trade (24 May), Hong Kong April trade (25 May), and Vietnam May trade balance (25-31 May). Singapore (25 May) and Taiwan (26 May) will report their final 1Q GDP numbers this coming week. There will be several Reserve Bank of Australia officials speaking in public forums throughout this week. Indonesian market will be closed on 25 May (Thursday) for a public holiday.

US AND DEVELOPED ECONOMIES Geo-political and international events will be the focus of developed economies this week as the data docket takes a backseat. Amidst the political turmoil in Washington, US President Trump will embark on his first overseas trip as the US president with a very packed itinerary. The first country to receive him will be Saudi Arabia (20-21 May), and then to Israel (22-23 May), Italy and the Vatican (24 May), Belgium (NATO, 24-25 May) and back to Italy (G7 Summit, 26-27 May). The EU/Eurozone Finance Ministers meeting will take place in Belgium (22 May) followed by the 28th NATO Summit also in Belgium (24-25 May) of which Trump and German Chancellor Merkel will attend. Finally, it will be the 43rd G7 Leaders’ Summit in Italy (26-27 May). Bank of Canada (24 May) is the only G7 central bank with a monetary policy decision this week while the focus of the Fed Reserve is the 2-3 May 2017 FOMC minutes (on 25 May, 2am SG time). We have a few senior Fed Reserve officials (voters in 2017 FOMC such as Harker, Evans, Kashkari and Kaplan) & BOJ Gov Kuroda (24 and 27 May) speaking in public forums but FOMC Chair Yellen and Vice Chair Fischer are again not listed on any speaking event yet. The key data from the G7 economies this week is likely the 1Q 2017 GDP from Germany (f) (23 May) and Japan April trade data (22 May) and April CPI (26 May), and the May prelim manufacturing & services PMI surveys from the developed economies including Eurozone, US and Japan (24 May). The US data docket includes April trade balance (25 May), April durable goods orders (26 May) and housing data (23 & 24 May). This is a full working week for developed markets but US and UK will end the week with a long weekend for their respective holidays on 29 May 2017 (Monday).

CHART OF THE WEEK Bloomberg US ECO Surprise Index: After A Good Run, US Data Started To Disappoint Since Early 2017

0.80 0.60 0.40 0.20 0.00 -0.20 -0.40 -0.60 -0.80 -1.00 Jul 13 Nov 13 Apr 14 Sep 14 Jan 15 Jun 15 Oct 15 Mar 16 Aug 16 Dec 16 May 17 Bloomberg ECO Surprise Index

Source: Bloomberg, UOB Research (as of 18 May 2017)

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RECENT RESEARCH PUBLICATIONS 15 – 19 May 2017

China: Maintaining Neutral and Prudent Monetary Policy [Chinese Version here]

ASEAN: Ready For US Fed Balance Sheet Reduction? [Chinese Version here]

Thailand: Stronger 1Q17 GDP Growth

Thailand’s Eastern Economic Corridor: The Next Major Economic Zone Of ASEAN

China: Formal Approval For China-Hong Kong Bond Connect

Singapore: Sharp Pullback In April NODX Is Only Temporary

Malaysia: Inflation Ebbs In April

Japan 1Q17 GDP: Growth Extends 5 Quarters, Best Run Since 2006

China: Belt And Road Initiative And What It Means

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KEY DATA/EVENTS: ASIA & OCEANIA

Date Data/Event Mth Prior Date Data/Event Mth Prior 19 May MA GDP YoY (SA QoQ=1.4%) 1Q 4.50% 25 May AU RBA's Bullock Speech in Sydney IR Elections In Iran CH Swift Global Payments CNY Apr 1.78% 21 May SK Exports 20 Days YoY May 28.40% RBA's Debelle Opening Remarks in AU SK Imports 20 Days YoY May 16.40% London TA Bounced Check Ratio Apr 0.19% 22 May SK PPI YoY Apr 4.20% HK Exports YoY Apr 16.90% TA Unemployment Rate Apr 3.84% HK Imports YoY Apr 13.00% MA Foreign Reserves May-15 $96.1b HK Trade Balance HKD Apr -42.3b TA Export Orders YoY Apr 12.30% Conference Board China April SK BoK 7-Day Repo Rate May-25 1.25% CH Leading Economic Index VN Trade Balance May -$800m 23 May AU RBA's Debelle Speech in Basel SK Discount Store Sales YoY Apr 2.50% ANZ Roy Morgan Weekly Consumer AU May-21 -- SK Department Store Sales YoY Apr 2.30% Confidence Index SI CPI Core YoY Apr 1.20% VN Exports YTD YoY May 15.40% VN Imports YTD YoY May 24.90% SI CPI YoY Apr 0.70% VN Retail Sales YTD YoY May 9.60% SI CPI NSA MoM Apr 0.00% VN Industrial Production YoY May 7.40% TA Industrial Production YoY Apr 3.22% SI GDP YoY (SAAR QoQ=-1.9%) 1Q F 2.50% HK CPI Composite YoY Apr 0.50% 26 May SK Consumer Confidence May 101.2 24 May NZ Trade Balance NZD Apr 332m SI Industrial Production YoY Apr 10.20% NZ Exports NZD Apr 4.65b SI Industrial Production SA MoM Apr 5.00% NZ Imports NZD Apr 4.31b TH Foreign Reserves May-19 -- NZ Trade Balance 12 Mth YTD NZD Apr -3671m RBNZ Governor Wheeler Speaks in TA Monitoring Indicator Apr 24 NZ Hamilton (Not Public) TA GDP YoY 1Q F 2.56% AU Westpac Leading Index MoM Apr 0.08% 27 May CH Industrial Profits YoY Apr 23.80% AU Skilled Vacancies MoM Apr -0.60% AU Construction Work Done 1Q -0.20% SK Short-Term External Debt 1Q $105.2b TH BoT Benchmark Interest Rate May-24 1.50% SI COE Auction May-24 TA Money Supply M2 Daily Avg YoY Apr 3.64% VN CPI YoY May 4.30%

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KEY DATA/EVENTS: US AND DEVELOPED ECONOMIES

Date Data/Event Mth Prior Date Data/Event Mth Prior 19 May Fed's Bullard to Speak about U.S. 24 May US GE Markit Germany Manufacturing PMI May P 58.2 Economy and Monetary Policy GE Markit Germany Services PMI May P 55.4 EU Commission's Guersen Speaks EC at ECB Conference in Brussels GE Markit/BME Germany Composite PMI May P 56.7 20 May President Trump to Visit Riyadh, EC Markit Eurozone Manufacturing PMI May P 56.7 US Saudi Arabia. First foreign visit as US President. EC Markit Eurozone Services PMI May P 56.4 22 May President Trump to Visit Tel Aviv, EC Markit Eurozone Composite PMI May P 56.8 US Israel. 22-23 May. US MBA Mortgage Applications May-19 -- EU/Euro-Area Finance Ministers EC Meet in Brussels, Belgium (22-23 US FHFA House Price Index MoM Mar 0.80% May) US House Price Purchase Index QoQ 1Q 1.50% Rightmove House Price UK May 1.10% US Markit US Manufacturing PMI May P 52.8 MoM(YoY=2.2%) Trade Balance US Markit US Services PMI May P 53.1 JN Apr ¥614.0b (Adjusted=¥172.2b) US Markit US Composite PMI May P 53.2 JN Exports YoY Apr 12.00% Fed's Kaplan Speaks in Toronto; US JN Imports YoY Apr 15.80% Kashkari in Wincousin 25 May NA 28th NATO Summit concludes in

JN Leading Index CI Mar F 105.5 TO Brussels, Belgium. JN Coincident Index Mar F 114.6 President of European Council Donald Tusk, President of the JN Convenience Store Sales YoY Apr 0.00% EU/ European Commission, Jean- US US Chicago Fed Nat Activity Index Apr 0.08 Claude Juncker Meet With US Harker Philadelphia, Kashkari in President Trump US Minneapolis Fed Conference UK GDP QoQ(YoY=2.1%) 1Q P 0.30% 23 May US President Trump meets Italian nd US/ 172 (Ordinary) OPEC Meeting President Sergio Mattarella & PM IT Gentiloni US Advance Goods Trade Balance Apr -$64.2b JN All Industry Activity Index MoM Mar 0.70% US Wholesale Inventories MoM Apr P 0.20% JN Machine Tool Orders YoY Apr F 34.70% US Retail Inventories MoM Apr 0.40% GE GDP SA QoQ (NSA YoY=2.9%) 1Q F 0.60% US Initial Jobless Claims May-20 -- FR Business Confidence May 104 US Continuing Claims May-13 -- FR Manufacturing Confidence May 108 US Kansas City Fed Manf. Activity May 7 GE IFO Business Climate May 112.9 26 May The 43rd G7 Summit to be held in Taormina, Sicily, Italy. First time GE IFO Expectations May 105.2 attendees include US President G7 GE IFO Current Assessment May 121.1 Trump, UK PM May, French UK Public Finances (PSNCR) Apr 34.3b President Marcon and Italy PM Gentiloni UK Public Sector Net Borrowing Apr 4.4b JN Natl CPI YoY Apr 0.20% US New Home Sales (MoM=5.8%) Apr 621k JN Natl CPI Ex Fresh Food YoY Apr 0.20% US Richmond Fed Manufact. Index May 20 JN Natl CPI Ex Fresh Food, Energy YoY Apr -0.10% Evans in Shanghai, China: US Kashkari with reporters in JN Tokyo CPI YoY May -0.10% Minneapolis JN PPI Services YoY Apr 0.80% 24 May US/ Donald Trump meets Pope Fed's Bullard Speaks on U.S. US Vac Francis economy in Tokyo 28th NATO Summit to be held in NA US GDP Annualized QoQ 1Q S 0.70% Brussels, Belgium (24-25 May). TO Trump and Merkel to attend. US Personal Consumption 1Q S 0.30% CA Bank of Canada Rate Decision May-24 0.50% US Durable Goods Orders Apr P 0.90% US Existing Home Sales (MoM=4.4%) Apr 5.71m US Core PCE QoQ 1Q S 2.00% ECB account of the monetary US U. of Mich. Sentiment May F 97.7 EC policy meeting US U. of Mich. 5-10 Yr Inflation May F 2.30% US FOMC Meeting Minutes May-03 -- 27 May The 43rd G7 Summit concludes in G7 JN BOJ Kuroda speaks in Tokyo Taormina, Sicily, Italy. BOJ Kuroda speaks in Waseda JN Nikkei Japan PMI Mfg May P 52.7 JN University GE GfK Consumer Confidence Jun 10.2 FR Markit France Manufacturing PMI May P 55.1 FR Markit France Services PMI May P 56.7 FR Markit France Composite PMI May P 56.6

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