Korean early trade data is always noisy, but today's numbers for the first 10 days of July don't show any significant change in underlying strength in exports and the trade surplus. Wage growth in Taiwan of around 3% likely means a floor for core CPI of 2%.
Corporate price data for Japan show the impact on the terms of trade of costlier oil imports continues to be offset by higher prices for chip exports. Nonetheless, rising import costs are pushing up PPI. In Taiwan, headline data show the gradual acceleration in underlying wage growth is continuing.
Lots today: no-change inflation data in China, a strong sakura regional report from the BOJ, Taiwan's foreign trade showing peaky exports but strong capital goods imports, and evidence that the strong rise in nominal GDP growth is boosting tax revenues in Korea.
The dip in Japan's CA surplus in May was not enough to alter the upwards trend, bank lending was strong in June, but the EW survey recovered only modestly in July. In Korea, the huge CA surplus rose further in May, but so did selling of domestic equities by foreigners.
Today, an update on the household sector in Japan with May wage and consumption data. Also, inflation data for Taiwan in June, and the Q1 flow of funds in Korea showing equities now account for 30% of household assets, up from 20% just a year ago.
Upstream prices in China fell at the end of June, showing the feed through from the decline in the global oil price. Data on Friday showed a modest positive output gap in Japan. FX reserves in Taiwan dropped moderately in June.
Some summary charts of a (much) longer chart pack summarising regional themes. In terms of the data flow, the S&P services PMI for Japan ticked up in June, but the consumer confidence survey earlier in the week was still soft. The S&P services PMI for China was once again puzzlingly strong.
The strength of corporate sentiment and prices in the BOJ Tankan is significant for the policy outlook. The rise in inflation in Korea slowed in June, but cost-push and demand-pull point to core inflation remaining firm. After withdrawing liquidity in recent months, the PBC changed course in June.
China's RatingDog mfg PMI continues to be much stronger than the official version. Korea's PMI fell, even though June exports rose again. In the Japan Tankan, sentiment was stronger and prices up across the broad. In Taiwan, the highlight was the strength of today's non-mfg PMI.
China's PMIs ticked up in June, but not by enough to dispel recent concerns about the cycle. In Japan, this year's pick-up in IP was sustained in May. The message from Korea's month-end data is a bit mixed, but there are some signs of the cycle broadening.
China industrial profits in May rose 20% YoY, boosted by upstream industries. Even so, overall profits have to still to break through the top of the post-2022 range. In Japan, retail sales were strong in May. Consumer confidence in Taiwan improved in June as price expectations fell.
A chart pack to summarise the longer note of earlier this week on the semi supercycle in Asia. Also, some more details on China's import growth in May, Tokyo CPI and 10-day export growth in Japan, the rise in Korean equity investment in the US and another strong monitoring index in Taiwan.
