The Week Ahead: Watch The Banks

China takes centre stage next week as the market looks for signs of an economic slowdown.

Last month’s manufacturing purchasing managers’ index (PMI) showed that activity fell to 51.6 from a five-year high of 52.4 in the previous month. A reading above 50 still indicates expansion. But the reading in October was below the long-term average of 52.

Non-manufacturing PMI also dropped last month, compared to the preceding month. However the reading of 54.3 would indicate that it is still expanding.

Japan will report its latest retail sales data. In September retail sales rose 2.2% year on year. There is still some way to go before Japan’s retail sales returns to its long-run average growth rate of 4.65%.

The Land of the Rising Sun will also report its latest inflation numbers. In September, the rate of inflation came in at 0.7%, which was unchanged from a month earlier. Prices of food rose at a faster pace but the cost of housing continued to fall.

Indonesia will also report inflation figures. In October, consumer prices rose 3.6% compared to a year ago. It was the lowest inflation rate since January as the cost of housing, health, food and transport rose at a slower pace.

India is fast catching up with China in terms of economic growth. In the second quarter of this year, it grew 5.7% year on year. That was below the 6.1% growth rate in the previous month. The moderation was attributed to a slowdown in consumer spending and exports.

And finally, it is time for those Singapore bank lending numbers again. So, keep an eye on those Singapore-listed banks that include Oversea-Chinese Banking Corporation (SGX: O39). In September, bank loans increased to S$640.7 billion from S$634.4 billion in the previous month.

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