Macro

• Lawrence Wong is slated to be the next PM. One cannot help but get a sense that the succession process was not as smooth as it might have been.
• In the upcoming cabinet reshuffle, Wong is likely to be elevated to the deputy premiership with one of the contenders – Chan Chun Sing – as second deputy PM. 
• Continuity in substantive policies is likely, the hallmark of Singapore politics – that the election of a new PM does not lead to any abrupt change in major policies.  

• Inflation broadly exceeded expectations for the sixth consecutive month as it reached 7% on the CPI and 9% on the RPI. The pull up to equilibrium prices continues.
• Underlying measures are less extreme but have still risen to excessive levels. The energy price cap drives inflation much higher in April to what we still see as the peak.
• More excess inflation without excess supply is another clear hawkish signal for the MPC. We maintain our forecast for it to deliver a fourth back-to-back rate hike on 5 May.

• (Finally) Raising Fuel Prices
• Silver Lining: Commodities Boost State Revenue
• Fiscal Deficit to Stay Elevated in 2022
• VAT Hike Broadened to Crypto; Carbon Tax Delayed

• Despite harsh restrictions, the trajectory of infections in Shanghai appears to be following that in Hong Kong. We also expect infections spikes in other localities that will spark more lockdowns.
• There is a clear shift in tone in recent statements made by the State Council that indicated rising worry over the state of the economy. More stimulus is virtually certain.
• If China’s policymakers fail to follow through with demand-side measures, the institutional barriers to doing so must be so considerable that even in crisis they militate against the optimal response.

• The rebound on the Dow Jones Industrial Average over the past several weeks has been impressive, as is the case with other US stock market indices
• However, when we zoom out and measure it in the proper manner against Gold with an historical lens, a different image emerges
• Overall, the picture on this Spooky Chart –Dow/Gold Ratio– still warns of another low over the coming 1-2 months i.e. a move in favour of Gold and against stocks

• We look in particular at the prospects for the globalisation which has so greatly benefited emerging Asia. Prior to the recent crises, globalisation had held up reasonably well.
• While the trade in goods may have lost some momentum, other dimensions of globalisation have continued to expand even in the face of repeated crises. 
• The trend towards self-sufficiency, protectionism and inward policies will hurt. However, there are offsetting forces which can help sustain cross-border flows of goods, services, capital, people and data.

• The Week That Was in ASEAN@Smartkarma is filled with an eclectic mix of differentiated, substantive, and actionable insights, macro and equity bottom-up, from across South East Asia.
• The past week saw Insights on Ultrajaya Milk (ULTJ IJ), Berli Jucker (BJC TB), and GoTo (GOTO IJ) ahead of listing today in Jakarta from Sumeet Singh and Brian Freitas.
• We also had insights from Henry Soediarko on Jasa Marga (JSMR IJ) and from Lloyd Moffatt on Steel Pipe Industry of Indonesia (ISSP IJ).

• UK GDP growth stalled to 0.05% m-o-m in Feb-22 as temporary covid-related health spending ended. Another 1pp might be subtracted over the next few months.
• Broader health spending remains bloated, symptomatic of the strains squeezing private sector activity as taxes increase to the detriment of long-term growth.
• Inflation’s erosion of real incomes is a painful headwind, but the annual GDP rate benefits from carry-over effects. We forecast 1% q-o-q in Q1 and 4.1% in 2022.

• Q4FY22 is expected to be a roller coaster quarter with COVID 3.0 impacting the first month of the quarter.
• However, Feb’22 witnessed some recovery as fewer fatalities revived the confidence in improving health conditions and thereby diminished the risk parameters.
• OUR TOP 10 “TRADING BUYs” Earnings Play: SBI, ICICI bank, Tata Steel, Nalco, Ashok Leyland, Eicher Motors, PSP Projects, ITC, Varun beverages, Tech Mahindra

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

• Cover Story: Finding jobs for China’s 10.76 million new college graduates

• Shanghai to ease strict lockdown measures for Covid-free areas

• China puts local protectionism on notice in dual circulation drive

• US and Eurozone economic outlooks have been muddied by recent US yield curve inversion and potential energy rationing. China’s COVID-19 lockdowns are impacting economic activity, undermining the government’s growth target.
• Asia faces rising inflation pressures due to stronger higher energy prices. Food also poses a significant threat to consumer prices in Asia due to higher weightings within CPI baskets.
• The yen has weakened in 2022, an outcome that presaged Asia’s late-1990s financial crisis. Further depreciation could provoke responses by China and other ASEAN countries to devalue their currencies.

• The pro-growth emphasis is still evident across Asia’s central banks, evinced by RBI’s hawkish pivot even as it intends to commence the “withdrawal of accommodation”.
• Governments are also stepping up to dull the impact of oil price hikes, taking the heat off central banks to tighten prematurely.
• Prudent policymakers in Asia has kept inflation under control, in contrast to the recent economic blow-ups in such EMs as Sri Lanka, Turkey, Pakistan and Brazil.

• In Depth: Metaverse trailblazers hope to make real money from virtual people

• Caixin Explains: Why China needs an overarching financial stability law

• 13 officials punished after investigation into case of ‘caged woman’

• Covid-19 Update: Caseload continued to decline in Mar’22 – After the accelerated rise witnessed in mid-Jan’22, Covid-19 cases in India declined throughout Mar’22
• High-frequency indicators: Marginal moderation in lead indicators – Google Mobility Data has displayed a revival towards pre-pandemic levels, with Covid-19 concerns receding
• Equities: Sector rotation is the key, Earnings Commentary Critical! – Mar’22 proved to be an eventful month with the rise in volatility, led by the prevailing geopolitical crisis as well as the US FED meeting and election results

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.