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Asia: the week ahead

Friday, January 06, 2012 - 02:05

Jan. 6 - China's final data release for 2011 will set the tone for Asia, with investors looking to trade and commodity output data. Indonesia and South Korea decide on rates, while aussie traders will watch consumer confidence data. Jon Gordon reports.

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NOTE: THIS EDIT CONTAINS CONVERTED 4 BY 3 MATERIAL A new report card from China - with data ranging from trade to commodity output due out. China's trade balance will be especially importantly, and analysts expect it to narrow to about 8-point-8 billion dollars. That's as the country's demand for imports grows at a faster rate than that of exports -- a trend that could signal slower appreciation of the yuan, says veteran investor Jim Rogers. SOUNDBITE (English) ROGERS HOLDINGS CHAIRMAN, JIM ROGERS, SAYING: "I know China's balance of trade, as we were just discussing, is not going to be nearly robust in 2012 as it has been in the past, so you know their balance of trade will look worse or maybe even look bad at times in 2012. so I wouldn't think the RMB will go up so much. I'm not selling it, because somewhere along the line, China is eventually going to open up its currency and make it completely convertible. At that time, well, it may go down for a while at first, but then it's go up and go up a lot." Also expect new figures on loan growth from China. Analysts are closely looking at this -- given the potential trove of bad debt from the lending binge that followed the 2008 financial crisis. Those banks may see their reserve requirements slashed -- traders bracing for more easing measures from China. Whether that comes true could rest on CPI figures out during the week. Elsewhere in Asia, both Indonesia and South korea will decide on interest rates.... but markets expect neither to cut rates yet, though they are shifting focus from fighting inflation to boosting growth. South Korea's President Lee Myung Bak is visiting China to meet with the country's leader Hu Jintao... with trade and North Korea likely on the agenda. And Australia reports consumer sentiment. Domestic confidence plunged last month... despite recent cuts in interest rates. A sour mood could upend domestic spending, putting more pressure on the Aussie dollar. Jon Gordon for Reuters in Hong Kong.

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Asia: the week ahead

Friday, January 06, 2012 - 02:05