global economy

Southeast Asian outlook: Rising cyclical risks, expanding structural upside

The global economy is being pulled and pushed in different directions. Whether it is the US’ trade spat with China or the fragility of China’s economy or the geopolitical stresses in the Middle East that are raising oil prices, the ups and downs of the news flow make it hard to discern the net impact. However, a close study of recent developments shows two opposing trends — the region will be hit hard by cyclical forces, but the structural prospects over the longer term are improving to the point where a new development surge is likely in Asean.

Southeast Asian outlook: Rising cyclical risks, expanding structural upside

The global economy is being pulled and pushed in different directions. Whether it is the US’ trade spat with China or the fragility of China’s economy or the geopolitical stresses in the Middle East that are raising oil prices, the ups and downs of the news flow make it hard to discern the net impact. However, a close study of recent developments shows two opposing trends — the region will be hit hard by cyclical forces, but the structural prospects over the longer term are improving to the point where a new development surge is likely in Asean.

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Oxford Economics lowers GDP growth forecasts across Asia on slowdown of manufacturing and exports sector

SINGAPORE (June 28): The recent US-China trade tension escalations have resulted in the deterioration of the manufacturing and exports sector – causing Oxford Economics to lower its GDP growth forecasts across most of Asia.

Most countries recorded negative export growth with the exception of China (up 1.1%) and India (up 3.9%).

Vietnam’s goods exports were also up a solid 9.5% on the year, as exports to the US have accelerated, likely reflecting some trade diversion due to the US-China trade war. This has partly offset weaker demand from China and the region.

State Street's investor confidence index up 8.2 points to 87.6 as central banks turn dovish

SINGAPORE (June 27): The State Street Investor Confidence Index (ICI) has increased to 87.6, up 8.2 points from May’s revised reading of 79.4 – a reflection of how investors across all regions investors across all regions have an improved appetite for risk.

EPS growth of global markets likely to slow from 16% to 5%: Citi 2H outlook

SINGAPORE (June 25): Diversify your investments; Don’t time the markets; and look at opportunities in Emerging Markets, says Citi Private Bank in its mid-year outlook report.

Although global economic growth appears firm for the time being, the trade war between China and the United States as well as the Iran oil export sanctions have cast a pall of uncertainty over the investment horizon.

According to Citi, EPS growth of global stocks is likely to slow from 16% to 5%, while EPS growth of US stocks should slow from 23% to 4% due to its high dependence on trade. 

Largest Singapore M&A deal done in 1H2019, but bankers earned lower amount of fees than before

SINGAPORE (June 24): The total value of merger and acquisition deals involving Singapore entities surged in the first half of this year, boosted by what is by far Singapore’s largest deal ever: the sale of Global Logistic Properties’ US logistics assets to Blackstone Group for US$18.7 billion ($25.4 billion). In total, some US$59.4 billion worth of M&A deals were transacted in the first half of this year alone. That is 64% more than the same period the year before, according to data from Refinitiv. However, investment bankers collected lower fees during the period.

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Get ready for more bad news for the global economy

SINGAPORE (June 10): The gods have been conspiring against the world economy, where nothing seems to be going right. Economic activity is losing vitality virtually everywhere — even the seemingly unstoppable US economy is slowing. Tensions between the US and China are escalating. And this has not stopped the US from ramping up trade aggression even against friendly nations such as Malaysia and Singapore or potential strategic allies such as India.

How bad will things get and what will the impact be on regional economies?

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Singapore's weak 1Q GDP growth signals tough times ahead: RHB

SINGAPORE (May 28): RHB Research is turning negative on Singapore’s short-term economic outlook on expectations of a prolonged slowdown in the electronics sector as well as weaker global growth prospects.

As such, the research house is revising its 2019 GDP growth estimate downward to 1.8% from 2.5% previously.

The global economy is better than you think

SINGAPORE (Apr 15): Gloom pervades the reports we read on the global economy. Data showing a slowdown is described breathlessly as the worst in so many months or years, giving a sense that things are just getting from bad to worse. Now, the International Monetary Fund has joined in and downgraded forecasts for global growth. But are things really that bad? In fact, we find five strong reasons why global growth could surprise on the upside, boosting prospects in our trade-dependent region.

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Slowdown more likely than global recession, says Oxford Economics, unless ...

SINGAPORE (Mar 25): The global economy may continue to slow down in the near term but the world will probably dodge a recession this year unless it is hit by big shocks or serious policy errors, says Oxford Economics.

Since 1980, Oxford Economics says there have been eight significant global slowdowns in which world growth has decelerated below its long-term average of 2.9%.

But of the eight slowdowns, four ended up turning into recessions but the two most recent global soft patches of 2011-12 and 2015-16 did not.

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