Asia Week Ahead: RBA Rate Decision, China Trade & Key Data Across Major Economies

Australia: RBA Anticipated to Maintain Rates

The Reserve Bank of Australia will likely keep its current cash rate unchanged on Tuesday. The decision follows third-quarter consumer price index (CPI) inflation readings that came in above the central bank’s 2.5% midpoint target range. That inflationary pressure is expected to outweigh a surprise uptick in September’s unemployment rate, even as broader labor market indicators continue to demonstrate underlying economic strength.

China: Trade Growth Forecast to Cool

In China, economic focus shifts to trade data scheduled for release on Friday, following recent bilateral talks between Xi and Trump that helped de-escalate trade tensions. It is projected that China’s export growth will slow to 4.0% year-on-year, while import growth is expected to edge down to 3.2% year-on-year. This combination is forecast to drive a rebound in the country’s monthly trade surplus to $101 billion.

South Korea: Export Momentum Remains Robust

South Korean exports are projected to decline by 3.5% year-on-year in October, primarily driven by an unfavorable calendar effect. However, underlying trade momentum remains strong, supported by a forecasted 6% increase in daily average exports. Shipments of semiconductors and ships are expected to lead gains, offsetting a likely decline in auto exports. Concurrently, consumer price inflation in South Korea is anticipated to tick up to 2.3% year-on-year in October due to rising gasoline and manufactured food prices.

Japan and Regional Updates

Japan is set to release labor earnings and household spending figures that are projected to show continued growth, indicating that consumer demand remains stable despite elevated inflation. In Taiwan, CPI inflation is expected to remain below target with a modest 1.4% year-on-year increase in October, while robust trade growth continues with exports forecasted to surge 35.1% year-on-year. Meanwhile, the Philippines faces a sharp slowdown in third-quarter GDP growth to 5.1%, driven largely by a significant contraction in government spending amid corruption scandals associated with flood control projects.