This week kicks off with the release of Malaysia‘s inflation figures for August on Monday. Economists expect the country’s inflation, as measured by the Consumer Price Index (CPI), to remain subdued, thanks to government incentive support.
The CPI remained unchanged at 2% year on year (y-o-y) in July for the third consecutive month, slightly below market consensus of 2.1%, largely due to a sharper-than-expected slowdown in food inflation.
UOB Global Economics and Markets Research is projecting headline inflation to remain steady at 2% as the Malaysian government continues to implement mitigating measures to minimise the impact of diesel subsidy cuts on businesses and cost of living amid falling global oil prices.
Bank Negara Malaysia will also release its international reserves as at Sept 13 on Monday. International reserves amounted to US$116.8 billion (RM488 billion) as at Aug 30, up from US$115.9 billion as at Aug 15.
Focus will also be on the Invest Malaysia-Iskandar: Where Policy Meets Progress conference, which is the flagship edition of Bursa Malaysia’s Invest Malaysia series, on Thursday (Sept 26). Prime Minister Datuk Seri Anwar Ibrahim is set to deliver the keynote address.
According to Bursa, this particular edition is specifically being held in Iskandar Puteri, Johor to showcase the region as the country’s premier southern gateway, showcasing its major developments and attractive incentive offerings for investors. “This will provide an opportunity for investors to better understand Malaysia’s macroeconomic landscape especially in Johor, and market prospects with a focus on the Johor Singapore Special Economic Zone (JSSEZ).”
Singapore will publish its August inflation data on Monday, followed by the August industrial production data on Thursday. UOB expects headline August CPI to fall to 2.2% y-o-y from 2.4% y-o-y in July.
Elsewhere in Asia-Pacific, policy decisions by the Reserve Bank of Australia (RBA) are due this week. There is no expectation of any rate change at the forthcoming RBA meeting, though rate cuts are not ruled out later in the year. According to a Bloomberg survey, all 10 analysts polled expect the RBA to keep rates on hold at 4.35%.
S&P Global Market Intelligence says this week will see flash Purchasing Managers’ Index (PMI) data for September for major developed economies.
“Amid uncertainty that persists regarding the extent to which global central banks, including the US Federal Reserve (Fed), are expected to continue lowering rates, the September flash PMI data offer the earliest insights for growth and inflation conditions. This is in addition to the assessment of business confidence levels amid ongoing political developments,” it said in its weekly report last Friday.
It adds that the most important official economic data releases of the week will be the core personal consumption expenditures (PCE) inflation reading, which showed a 0.3% monthly increase last month to leave the annual rate at 3.2%. PCE is a measure of the spending on goods and services by people living in the US.
Then there’s the flash CPI number in the eurozone, which showed the core annual rate stuck at 2.8%.
“So the US Federal Open Market Committee finally got round to cutting US interest rates, joining the other major central banks such as the European Central Bank and Bank of England in loosening monetary policy. Importantly, a common theme is not just the fact that inflation looks to be beaten, but that the economy is looking vulnerable to a downturn. Hence, the flash PMI surveys will be hotly awaited for clues as to the next move in rates, as these data will provide markets with timely signals on economic growth trajectories as well as price trends.
“However, with interest rate cutting cycles now in train in the US and Europe, September’s PMI data will also be eyed for clues as to whether monetary policy is helping to sustain these upturns. Signs of further economic weakness in the flash PMIs will therefore translate into greater chances of more aggressive rate cuts in the months ahead, while signs of resilience will add to a more cautious approach,” said S&P Global Market Intelligence.
On the local corporate front, Northeast Group Bhd will be launching its initial public offering prospectus on Thursday in conjunction with its upcoming listing on the ACE Market of Bursa Malaysia. The Penang-based precision engineering component manufacturer is looking to raise money for the construction of a new factory and the purchase of new computer numerical control machines.
On Friday, fortified food and beverages and dietary supplements manufacturing service provider OB Holdings Bhd will be launching its prospectus in conjunction with its upcoming listing on the ACE Market.
Meanwhile, listed companies scheduled to hold their extraordinary general meetings include Lion Industries Corp Bhd (KL:LIONIND) on Tuesday. Farm Fresh Bhd (KL:FFB), Turiya Bhd (KL:TURIYA), Iris Corp Bhd (KL:IRIS) and Talam Transform Bhd (KL:TALAMT) will have their annual general meetings on Wednesday, Sunview Group Bhd (KL:SUNVIEW) and AHB Holdings Bhd (KL:AHB) on Thursday and LYC Healthcare Bhd (KL:LYC) and Lay Hong Bhd (KL:LAYHONG) on Friday.
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