- China’s exports growth should ease on slowing momentum.
- India’s CPI could bump up on higher food costs.
- Taiwan’s exports could moderate as the AI cycle normalizes.
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FORTHCOMING DATA RELEASES
Taiwan
Export growth is expected to ease to 44.4% yoy in October from 60.9% in September. A higher comparison base makes exceptional export growth difficult to sustain from 4Q onwards. The global AI cycle is also expected to settle into a more normal pace into 2027, as higher interest rates lift capital costs and US mid-term election results heighten regulatory uncertainty. These factors underpin our forecast for Taiwan’s GDP growth to return to high single digits from 4Q onwards and into 2027.
Malaysia
We expect Malaysia’s industrial production growth to rise to 5.5% yoy in September 2026 from 5.0% yoy in August. The uptick was likely driven by export-oriented manufacturing as strong artificial intelligence (AI)-related demand continued to support growth in electrical and electronics goods, alongside a smaller contraction in mining.
China
Export growth is expected to decelerate from 36.3% yoy in September to 28.1% in October. Both the official manufacturing PMI and new export orders sub-index fell below 50 after two months in expansion territory. High-frequency trade indicators also point to slowing momentum, with average daily deadweight tonnage handled at China’s 20 major ports falling from 7.2% yoy in September to -4.2% in October. Freight activity weakened as well, with growth in international cargo flights dropping from 3.6% yoy to -5.9% over the same period. On the price front, factory-gate and raw material price pressures moderated, with the main raw material purchasing price and producer price sub-indices declining from 60.8 and 54.0 to 56.8 and 51.7, respectively. Despite remaining above the 50 threshold, the moderation suggests some easing in pipeline price pressures. Downstream consumer price pressures are also likely to remain subdued amid soft domestic demand. As a result, CPI inflation is expected to ease slightly from 0.9% yoy in September to 0.8% in October.
India
We expect headline inflation to rise to 6.0% yoy in October from 5.5% the month before, on higher food costs and a low base effect. High frequency data pointed to a further pick-up in sequential pressures in food segments, across cereals, edible oil, perishables (vegetables) etc. Non-food components should find relief from further moderation in precious metals and delay in passage of retail fuel price changes. Core inflation is nonetheless set to quicken to 4.5-4.6% as services notch increases and as indirect tax effects in the base, fall out of the equation. With inflation expected to test past the higher end of the RBI target range, we expect a second successive rate hike in December. The decline in oil prices has also led to cooling of overnight OIS rates as concerns over aggressive rate hikes have eased. Goods trade deficit is likely to stay wide at above $30bn in Oct.
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