If the central bank also expects a second-quarter rebound then its focus should stay on inflation and weak JPY as a main contributor, they said. April inflation is tipped to ease due to a high base, but pipeline inflation indicates building pressures for the coming months, ING said.
Investors are expected to monitor the Ministry of Finance's auction of 10-year inflation-indexed JGBs on Monday and auction of 40-year JGBs on Wednesday, given ongoing worries over possible further policy rate increases by the Bank of Japan as well as concerns about potential reductions in the central bank's bond purchases.
Market participants may also continue to be on the lookout for warnings from Japanese authorities over currency movements with the yen still trading in a somewhat weak 155-160 range against the U.S. dollar despite recent speculation authorities conducted foreign-exchange interventions to prop up the yen.
The Japanese cabinet's monthly economic report might also draw some attention as traders watch for statements about the possible end of deflation.
INDONESIA
Central bank policymakers in Indonesia are widely expected to keep rates on hold on Wednesday after a surprise rate hike at its last meeting.
The rupiah clawing back some ground versus USD should provide some reprieve to Bank Indonesia and let it leave the policy rate unchanged, Barclays economists said. Still, they see the risk of another hike as elevated, especially if there is renewed weakness in the Indonesian currency.
"We expect the sudden rate hike in April… to be the last hike by BI for this year," UOB economists said, keeping their forecast for a pause through the year as uncertainty remains high.
Goldman Sachs economists see no inflationary trigger for a rate move either, with headline CPI inflation comfortably within the central bank's target band. With inflation well-behaved and IDR stabilized, Bank Indonesia is most likely to stay on the sidelines in May, they said.
THAILAND
Thailand reports first-quarter gross domestic product data on Monday.
The country's economy is estimated to have grown 0.8% from a year earlier, according to the median estimate of 10 economists surveyed by The Wall Street Journal. That compares with 1.7% growth the previous quarter.
UOB economists expect sluggish growth momentum to persist, weighed by weak domestic demand. This could lead the central bank to recalibrate its monetary policy for the rest of 2024, they added.
UOB expects two rate cuts in 2024, penciling in reductions of 25 basis points each at the central bank's June and August meetings.
Goldman Sachs economists expect that inbound tourist arrivals and spending improved in the first quarter, "providing support to the domestic economy in the face of still subdued public investment spending due to delay in the passage of the FY24 budget."
SINGAPORE
Singapore reports revised GDP growth numbers for the first three months of the year on Thursday, followed promptly by inflation figures for April on the same day.
Balance of payments figures for the first quarter will also be released Thursday, along with a review of the city-state's trade performance during the three months.
Singapore's non-oil domestic exports fell in April for a third straight month, but improved from the previous month's decline. Economists say the data point toward a gradual, but fragile, trade recovery.
An in-line or better-than-expected GDP growth reading could help allay concerns over the city-state's outlook.
Economists at Barclays think weaker-than-expected manufacturing activity will likely result in the GDP being revised slightly lower. UOB's economics team also expects a cut, reflecting the drag from March's industrial production data.
(All references to days for Asian events are in local times.)
- Additional reporting by Emese Bartha, Miriam Mukuru, Paul Vieira, Kosaku Narioka, Xiao Xiao, Ronnie Harui, Kwanwoo Jun
Write to: Jessica Fleetham at jessica.fleetham@wsj.com and Fabiana Negrin Ochoa at fabiana.negrinochoa@dowjones.com
(END) Dow Jones Newswires
05-17-24 0758ET
