Financial market activity in Asia on Monday will be lighter than usual with U.S. markets closed for the Martin Luther King Jr. holiday, but there is a decent sprinkling of local economic and political developments for investors to get their teeth into.
Japan releases money supply figures, South Korea and Indonesia publish their latest trade numbers, while Indian wholesale price inflation data are also due out following CPI figures last week that showed price pressures in December were not quite as hot as forecast.
On the political front, there may be ripples from the parliamentary and presidential elections in Taiwan on Saturday, in which the ruling, pro-independence Democratic Progressive Party won a third term.
China, which last week vowed it would “smash any independence plots”, condemned foreign governments that congratulated Taiwan’s president-elect Lai Ching-te on his victory.
The potential for military conflict between China and Taiwan is one reason investors are increasingly cautious on China where a property sector bust, deflation and sluggish growth are already giving them serious food for thought.
Wednesday sees the release of another batch of top-tier economic indicators – house prices, fixed asset investment, industrial production, unemployment and retail sales, culminating in fourth quarter GDP growth.
China’s growth is expected to have picked up from 4.9% year-on-year in the third quarter, but only due to favorable base effects.
Economists at SocGen are forecasting 5.3% and their peers at Goldman Sachs are eyeing 5.6%. On the gloomier side, economists at Barclays are predicting just 4.5%, and warn that the risks to their already sub-consensus 2024 outlook of 4.4% GDP growth are tilted to the downside.
