Demand For ASEAN Palm Oil And Coal Resilient: HSBC

KUALA LUMPUR, Feb 13 (Bernama) -- Demand for ASEAN’s largest crude commodity exports, palm oil and coal, should prove resilient, said HSBC Bank Malaysia Bhd. In a statement Tuesday, HSBC Chief ASEAN Economist, Joseph Incalcaterra, said demand for palm oil -- a sector that Indonesia and Malaysia dominate with 80 per cent of global production -- was expected to continue accelerating alongside the fast population growth in India and Africa. Meanwhile, China’s Belt and Road projects would have a tangible impact on ASEAN economies over the next five years, especially Malaysia, Indonesia and the Philippines. “We estimate that in each country, there are projects worth 10-15 per cent of gross domestic product in the pipeline, and are confident that many of them, especially the railway lines, energy generation plants and port facilities, will eventually be realised, given their strategic nature for China,” Incalcaterra said. He said given that ASEAN faces a significant infrastructure financing gap, this would be a welcomed development. ‘All in all, as domestic demand picks up further in the coming quarters, labour markets should become more resilient. “It is precisely this broader, more stable economic story that we believe will provide central banks with the confidence to gradually reduce stimulative monetary policies. “Indeed, we forecast central banks in Malaysia, Singapore, and the Philippines will tighten policy during the first half of 2018, in a measured fashion. After all, despite some volatility in headline inflation as oil prices adjust higher, core prices appear well-anchored,” Incalcaterra added. --BERNAMA