Prakash Sakpal, Economist at ING, suggests that the GDP growth across Asia is poised for a sustained slowdown in the fourth quarter.
Key Quotes
“China’s manufacturing PMI for November coupled with hard manufacturing data from Japan, Korea, Singapore, and Thailand for October will give a sense of where GDP growth of these countries is headed in the final quarter of the year.”
“We don’t see China’s manufacturing PMI drifting far off the threshold level of 50; where it has hovered around since September. Even though export growth has held up since the onset of the trade war, export orders have been contracting at an increasing pace. This has dragged industrial production growth below 6% in the last two months, supporting our view of GDP growth slipping below 6.5% in the final quarter.”
“Electronics matter more for the rest of the Asia reporting manufacturing data and judging by the ongoing sell-off in electronic stocks; things don’t appear to be looking great.”
“Electronic exports from Korea are still growing on an annual basis, but those from Japan, Singapore, and Thailand have either been flat or contracting. Not only electronics, but weak automobile demand has been an added drag on manufacturing in Japan and Thailand.”
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