Societe Generale economists Suktae Oh and Kiyong Seong expect the BOK to deliver a 25-basis-point cut in October, citing downside risks to economic growth and benign inflation.
Regardless of whether the BOK kicks off its easing cycle in October or November, the market has priced in 100 basis points of cuts by end-2025, they said.
JAPAN
The Bank of Japan is scheduled to hold a branch managers' meeting on Monday, where it will release a quarterly regional economic report. Analysts will watch the report to see whether economic improvements are felt across the nation amid speculation over the timing of the bank's next rate increase.
As BOJ grows more concerned about the economic outlook, government data due next week may send some worrying signals.
Household spending, scheduled for release on Tuesday, is expected to have declined 2.7% in August from a year earlier, according to economists polled by data provider Quick. Typhoons and higher prices likely limited spending activity, economists expect.
More data on Tuesday is expected to show Japan had a current-account surplus of 2.907 trillion yen ($19.78 billion) in August, according to Quick, shrinking from 3.193 trillion yen in July due to the impact of the currency's appreciation.
The Ministry of Finance is scheduled to auction 900 billion yen of 30-year JGBs on Tuesday, and 2.3 trillion yen of five-year JGBs on Thursday.
Market participants may monitor the results of the sale of super-long-dated sovereign bonds for any buying interest from Japanese pension funds or life insurers that are typically inclined to invest in that part of the yield curve owing to higher rates of returns.
INDIA
India's central bank announces its decision on Wednesday.
Economists mostly expect the Reserve Bank of India to keep rates on hold but a few see a sliver of space for a cut, or at least a stronger signal that a policy pivot is coming.
The RBI has multiple factors to weigh in its decision, including a larger-than-expected rate cut by the Fed, falling oil prices and potentially weaker global economic growth, Citi Research analysts said. But strong domestic economic growth and expectations of higher inflation over September-November period suggest that rate cuts are more likely to start next year, they said.
Nomura economists, meanwhile, think the time has come for the RBI to kick off its easing cycle, as inflation is now aligned with the RBI's 4% target, growth signals are softening and financial stability is no longer a restricting factor.
"We see a monetary policy inflection ahead and 100bp of total cuts in this cycle," they said, beginning with a 25-basis-point rate cut on Oct. 9. "The question is whether the RBI would be proactive, as we expect, or whether it will retain its hawkish stance."
CHINA
As China markets reopen after a week-long national holiday, investors will be watching for signs that policymakers will follow up their economic stimulus package with fiscal measures.
The perceived shift by policymakers to a pro-growth stance has ignited a stock rally in China and Hong Kong, and traders will be looking to see if the momentum will continue or fade away.
Citi analysts led by Xiangrong Yu and Xinyu Ji said that the first week back from the holiday offers a window for fiscal policy delivery.
If policymakers meet expectations, that could keep the fire under stock markets lit.
Thomas Mathews, head of markets at Capital Economics, sees scope for China's equity markets to hold on to recent gain and perhaps even extend them near term, but the long-term outlook remains fairly bleak.
Without further structural reforms, Chinese equities may once again prove to be a "value trap," and the rally may end up being short-lived, said DWS global chief investment officer Björn Jesch.
The data docket is light, with inflation figures--due Sunday, Oct. 13--set to grab the spotlight as observers look for signs that China's deflation woes are ebbing.
HSBC economists expect headline consumer price inflation to have accelerated to 0.9% on year in September from 0.6%, led by higher food costs. "Strong travel during the Mid-Autumn Festival likely provided some support for service prices," they added. Producer price deflation meanwhile likely deepened further, they projected.
Money supply data due during the week could show positive signs of policy support.
The HSBC economists expect total social financing to have increased in September and new yuan loans to have risen as well due to seasonality and fiscal support. "We look for government bond issuance to still provide considerable support for total social financing."
TAIWAN
On Tuesday, back-to-back releases on trade and inflation in September will shed light on the state of Taiwan's economy.
The island economy has done well in the first half of the year, benefiting from its position as a chip-making powerhouse amid the artificial-intelligence boom. But uncertainties have emerged in the second half due to concerns about a global slowdown, debates around the AI outlook, and tightening domestic monetary and credit policies, said Ma Tieying, senior economist at DBS.
"While there are signs of softening growth momentum, we believe the overall cycle of economic expansion remains intact," she said.
Economists at HSBC expect Taiwan's headline CPI inflation to have softened in September, but core inflation to look resilient. They forecast a moderation in exports growth as well, but the monthly trade surplus to come in largely stable.
THAILAND
Thailand will be releasing inflation data for September on Monday.
The country's consumer-price index is expected to have risen 0.8% on year in September, according to the median forecast of five economists surveyed by The Wall Street Journal.
Headline inflation likely rose in part due to low base effects, ANZ Research analysts said in a report. Core inflation may have risen as well, they said, penciling in a 0.75% increase in September.
With low base effects set to persist in the following months, inflation looks poised to return to the lower half of the Bank of Thailand's 1%-3% target band in the fourth quarter, the analysts said.
Any references to days are in local times.
-- Additional reporting by Megumi Fujikawa, Tracy Qu, Ronnie Harui, Amanda Lee, James Glynn, Kwanwoo Jun, Kimberley Kao, Renae Dyer, Emese Bartha, Joshua Kirby and Paul Vieira
Write to Jessica Fleetham at jessica.fleetham@wsj.com and Fabiana Negrin Ochoa at fabiana.negrinochoa@wsj.com
(END) Dow Jones Newswires
10-06-24 1714ET
