Thailand

• Don’t delay reforms, says Moody’s – Deep political polarisation since 2006 is adding to structural challenges to Thailand’s competitiveness, and reform delays could eventually lower the sovereign credit profile, which has largely remained immune to the country’s political disturbances, warns Moody’s Investors Service. (Bangkok Post, 25/07/14)
• Household debt surges 16% in June, survey finds – The average level of household debt hit a record high at the end of June at Bt219,158 per family, surging 16% year on year, blamed on the slow recovery of the economy and a rising cost of living, according to a survey by the University of the Thai Chamber of Commerce (UTCC). (The Nation, 25/07/14)
• Baht under BOT watch as ‘good news’ draws funds – The Bank of Thailand is closely monitoring the strengthening of the baht, which has been caused by the return of foreign funds to the Kingdom’s capital and bond markets due to improved economic and political conditions. (The Nation, 25/07/14)

• SRT to submit its restructure plan to NCPO today. The 3 pronged plan will include: i) reducing debt of over Bt100bn, ii) increasing rental revenue; and iii) improving services. (ASTV Manager, 25/07/14)
• Manufacturers’ confidence increases to 88.4, rising for two months straight. Manufacturers still have concerns over Tier 3 US TIP sanctions, but remain confidence in the junta management. (Baan Mueng, 24/07/14)
• Ministry seeks to resume small-lot rice sales in August – The Commerce Ministry is preparing to resume selling rice from its stockpiles in early August, gradually releasing it in small lots of about 500,000 tonnes a month. (The Nation, 24/07/14)
• Board shake-ups continue – Krirk Vanikkul, the central bank’s deputy governor for financial institution stability, is tipped to be the next chairman of the Small and Medium Enterprise Development Bank of Thailand (SME Bank), while assistant governor Salinee Wangtal is expected to be named chairwoman of GH Bank, says a Finance Ministry source. (Bangkok Post, 24/07/14)
• Foreign Trade Department: 2H14 exports to grow well — The head of the Foreign Trade Department states that exports will grow well in the 2H14 at 6-7%, despite negative growth in 1H14. She also confirmed the department’s target export growth rate of 3.5%. (Post Today, 23/07/14)
• Ministry of Commerce to revamp competition law in Thailand. The ministry will revamp the law in an attempt to promote competition and level the playing field between private enterprises and state enterprises. (ASTV Manager, 23/07/14)
• Strong inflow pushing baht up to resistance level of 32 THB/USD. The BoT believes this is the result of inflows into the region following Indonesia’s elections. The NESDB said it is likely it will revise GDP forecast, despite the strong baht affecting exports. The Commerce Ministry remain bullish at 3.5% export growth. (Krungtep Thurkij, 22/07/14)
• Way forward through trading — ML Devakula, former BoT Governor and NCPO council member, said that the way forward for the Thai economy is through trading. With the model Thailand could achieve a 5-6% GDP growth annually. (Post Today, 22/07/14)
• Third quarter looking good for export growth – Exporters are salivating over stronger trade expansion this quarter, thanks to the recoveries in the European Union and United States, while worrying that fuel prices pushed up by the conflicts in Iraq and elsewhere in the Middle East might subdue global economic growth and trade. (The Nation, 22/07/14)
• Finance Ministry says tax collection will likely miss the target by Bt160bn, however it said coffers will be bulked up by gains from one-off revenue such as from the digital TV auctions, which will supply ~Bt620bn. The ministry will also consider issuing more bonds, after the good response to the recent issue. (Kom Chut Luek, 22/07/14)
• NCPO to re-evaluate 42 laws today, divided into tackling corruption, cost of living, the economy and labour issues. The NCPO will evaluate BoI benefits, foreign labour guidelines and the credit card bill. (Krungtep Thurakij, 22/07/14)
• Empty pockets — Pockets are again empty in the provinces after farmers used the money paid for rice to repay loans. This is leading businesses to worry over a third quarter slowdown. However they remain optimistic that NCPO policies will improve the current condition. (Kom Chut Luek, 22/07/14)
• NCPO signs an Chiang Mai Initiative Multilatralization Agreement (CMIM) with ASEAN +3. This will give Thailand access to a larger liquidity pool should finances become tight. (Prachachart Thurakij, 21/07/14)
• Chamber of Commerce backs plan to promote free trade zone in Tak, Sa Kaeo, Trad, Mukdahan, and Songkhla to promote trade with neighbouring countries. It is estimated this could add 20% to trade, lifting growth to 7-8% nationwide. (Kom Chud Luek, 21/07/14)
• Construction of dual-track railways gets green light – Work to lay additional rail tracks parallel to existing lines on crowded routes is set to begin in October, junta chief Prayuth Chanocha has announced. (Bangkok Post, 20/07/14)
• Department of Trade Promotion to issue a new Homali standard. The current mandatory 92% and voluntary 98% confusing. The department will work to merge the standards into one level. (Post Today, 21/07/14)

Globally

• IMF trims world growth forecast to 3.4% in 2014 – The International Monetary Fund (IMF) on Thursday lowered its global economic growth forecast to 3.4% this year, and expected the global growth could be weaker for longer due to weakness in advanced and emerging markets. (Xinhua, 24/07/14)
• US: In the week ending July 19, the advance figure for seasonally adjusted initial claims was 284,000, a decrease of 19,000 from the previous week’s revised level, representing the lowest level for initial claims since February 2006, said the U.S. Labor Department Thursday. (Xinhua, 25/07/14)
• U.S. sales of new single-family houses in June tumbled 8.1% to a seasonally adjusted annual rate of 406,000 from the prior month, far shy of market estimates, the Commerce Department reported Thursday. (Xinhua, 25/07/14)
• The seasonally adjusted Markit Flash U.S. Manufacturing Purchasing Managers’ Index stood at 56.3 in July, down from 57.3 in June, signaling the slowest improvement in overall manufacturing business conditions for three months. Readings above 50 suggest an expansion. (Xinhua, 25/07/14)
• Spain: Spanish economy grows in second quarter of 2014 – The Spanish economy grew by 0.5% in the second quarter of the year according to figures published by the Bank of Spain (BOE) on Wednesday. (Xinhua, 24/07/14)
• China July flash HSBC manufacturing PMI hits 18-month high of 52.0 — The preview reading of HSBC China manufacturing purchasing managers’ index rose to a 18-month high of 52.0 in July, compared to a final reading of 50.7 in June, according to a HSBC survey. (Xinhua, 24/07/14)
• S. Korea’s GDP growth posts 0.6% in Q2 – South Korea’s gross domestic product (GDP) growth posted 0.6% in the second quarter, central bank data showed Thursday. (Xinhua, 24/07/14)
• Japan’s trade deficit stands at US$8.10bn in June – Trade deficit for Japan stood at ¥822.2bn (around US$8.10bn) in June, recording the 24th consecutive month of red ink. Exports declined 2.0% from a year earlier, while imports soared 8.4% in June, according to the ministry. (Xinhua, 24/07/14)
• U.S. crude stockpiles decreased 4 million barrels to 371.1 million barrels last week, the Energy Information Administration ( EIA) said Wednesday. Stockpiles at Cushing, Oklahoma, the delivery point for U.S. crude, fell 1.5 million barrels to 18.8 million. (Xinhua, 23/07/14)
• IMF cuts 2014 U.S. growth forecast to 1.7% – The International Monetary Fund (IMF) cut its forecast for U.S. economic growth this year to a “disappointing 1.7% “, down from its June estimate of 2%, according to the final version of its annual review of the U.S. economy released Wednesday. (Xinhua, 23/07/14)
• US: The Federal Housing Finance Agency (FHFA) reported Tuesday that U.S. house prices rose 0.4% in May from the previous month, higher than market expectations of a 0.3% increase. U.S. Consumer Price Index increased 0.3% in June on a seasonally adjusted basis, living up to market consensus, the Labour Department reported Monday. U.S. existing-home sales increased 2.6% in June, reaching an annual pace of 5 million sales for the first time since October 2013, according to the National Association of Realtors. (Xinhua, 23/07/14)
• EU government debt increases to 88% of GDP in Q1 – At the end of the first quarter of 2014, the government debt to GDP ratio in 28-member European Union (EU) was recorded at 88.0%, compared with 87.2% at the end of the fourth quarter of 2013, reported Eurostat on Tuesday. (Xinhua, 23/07/14)
• Japan’s economic growth forecast for FY 2014 cut to 1.2% – The government on Tuesday cut its forecast for Japan’s economic growth in fiscal 2014 to 1.2% from 1.4% in real terms amid lingering fears that the April 1 consumption tax hike, the first in 17 years, may continue to weigh on domestic demand. (Kyodo, 22/07/14)
• Germany: Bundesbank sees second-quarter German stagnation – The German economy probably stagnated in the second quarter in the face of political tensions abroad, the Bundesbank said on Monday, but chances are its recovery will not be held up for long by conflicts on the rim of Europe. (Reuters, 21/07/14)
• Italy: Italy faces uphill struggle to achieve recovery – Italian industrial turnover fell 1% in May compared to April, the second consecutive month-on-month drop, while orders were down 2.1% after two consecutive months of rises, Istat said. (Xinhua, 21/07/14)
• HSBC up adjusts China 2014 GDP growth prediction to 7.5% on yr — The HSBC raised its prediction of China’s GDP growth in the third quarter of this year to 7.4% to 7.5% year on year, and raised the GDP growth in 2014 to 7.5% from 7.4%, according to the bank’s report on Monday. (Xinhua, 21/07/14)
• US: The Reuter/University of Michigan’s preliminary reading for U.S. consumer sentiment index in July dropped to 81.3 from 82.5 of the prior month, also falling short of market consensus of 83.
• The Conference Board Leading Economic Index for the United States advanced 0.3% in June to 102.2, following a 0.7% increase in May, also trailing market estimates. (Xinhua, 19/07/14)