GEM Newsletter: Poor Summer for East Asian Retail
August 25, 2014 - Global Economic Monitor: WORLDTREND DATABASE Malaysia and Vietnam saw generally strong growth in their retail sales indices during the first and second quarters of 2014, registering growth of 11.1% and 9.7% respectively in April-June. However, similar trends were not observed throughout many of their regional counterparts. While China reported an impressive 12.2% YoY increase in retail sales value for July that nonetheless fell short of expectations, nearby, Hong Kong fared much worse with real seasonally-adjusted retail sales decreasing in YoY terms for the past few months, by as much as 9.1% in June and 11.2% in April. These poor figures have been partly attributed to a decrease in luxury spending by Chinese tourists. The government in Hong Kong had to revise down its GDP growth expectations after weak consumption led to a lower than expected Q2 figure. Over in Japan retail sales value has been decreasing year-on-year for the past few months, due in part to the increase in value-added tax in April this year. Seasonally-adjusted sales in June decreased by 0.4% compared to June 2013 after two months of more significant drops. Similar declines were also observed in Singapore where seasonally-adjusted retail sales volume decreased by 2.9% YoY in real terms in June, the worst decline since 2009. GEM Highlights
- In July 2014 China recorded its highest monthly trade surplus ever, at USD 47 million.
- Poland recorded a 0.2% YoY fall in its Consumer Price Index, the first incidence of deflation in over 25 years.
- In contrast to most of the developed countries, the Reserve Bank of New Zealand increased its Main Policy Interest Rate to 3.5% in July 2014. It was the fourth rise this year.
- The US Labour Force Participation Rate continues to trend upward from its lowest rate observed in 36 years (of just 62.5% in January 2014). The participation rate now stands at 63.5% as of July 2014.
- In Ukraine, Monthly Average Earnings in US dollar terms decreased by 32.7% from USD 453 in December 2013 to USD 305 in June 2014, mostly due to the depreciation of the Ukrainian Hryvnia against the dollar.