AsianBondsOnline Newsletter (3 October 2011)

To read the full report, data and graphs go to http://www.asianbondsonline.adb.org/newsletters/abowdh20111003.pdf?src=wdh&id=Vd7k9wdkOhnXujvrtQLVzHQl3Ygf9j

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News Highlights – Week of 26 – 30 September 2011

Hong Kong, China’s export growth moderated to 6.8% year-on-year (y-o-y) in August from 9.3% in July amid a weaker global economy. In the Republic of Korea, export growth in September eased to 19.6% y-o-y in September from 25.9% in August, while its current account surplus narrowed to USD0.4 billion in August from USD3.8 billion in July. The Philippines’ trade deficit in July stood at USD570 million compared with USD183 million in July 2010. Thailand’s trade surplus fell to USD705 million in August from USD2.7 billion in July as export growth eased and import growth surged. Viet Nam’s exports rose 33.6% y-o-y in September while imports climbed 31.0% y-o-y.

*Viet Nam’s cumulative GDP growth rate for January-September was reported at 5.8% y-o-y last week. The People’s Republic of China’s (PRC) Purchasing Managers’ Index improved to 51.2 in September from 50.9 in August. Industrial production in Japan and the Republic of Korea expanded 0.6% and 4.8% y-o-y, respectively, in August. Factory output growth in the Philippines quickened to 6.8% y-o-y in July from 1.2% in June. Singapore’s manufacturing output grew 21.7% y-o-y in August, largely due to strong growth in biomedical products.

*Consumer price inflation in Japan stood at 0.2% y-o-y in August, while in Viet Nam inflation reached 22.4% y-o-y in September on the back of a sharp rise in food prices.

*Last week, two banks in the Republic of Korea-Hana Bank and Woori Bank-issued 3-year bonds worth THB8.0 billion and MYR315 million, respectively, while Malaysia’s AmIslamic Bank priced MYR600 million of 10-year subordinated notes.

*LCY corporate bond issuance in the Republic of Korea rose 27.1% month-on-month (m-o-m) in August, led by strong issuance growth in bank debentures and asset-backed securities.

*China Railway Construction announced last week its plan to issue CNY7.5 billion worth of medium-term notes. Shanghai Pudong Development Bank aims to sell CNY18.4 billion of subordinated debt. Indonesia plans to sell retail bonds with tenors of 3 years on 26 October. Krungthai Card intends to raise THB7.0 billion from a dual-tranche bond sale on 10 October. Thailand’s Central Pattana aims to issue THB2 billion of 5-, 7-, and 10-year bonds.

*The PRC banking sector’s assets grew 16.6% y-o-y to CNY104.4 trillion, while bank liabilities rose 16.0% y-o-y to CNY97.8 trillion in August.

*Government bond yields fell for all tenors last week in the PRC and Indonesia and for most tenors in Thailand and Viet Nam. Yields rose for all tenors in Hong Kong, China; Republic of Korea; and Singapore, and for most tenors in Malaysia. Yield movements were mixed in the Philippines. Yield spreads between 2- and 10-year tenors widened in the PRC; Hong Kong, China; Republic of Korea; and Singapore, while spreads narrowed in most other emerging Asian markets.

*Finally, some of the more interesting economic data due this week include consumer price inflation for Republic of Korea and the Philippines; export growth and trade balance for Malaysia; money supply for Japan and Indonesia; and foreign reserves for Hong Kong, China and the Philippines.

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