18/03/2025

BIZ & FINANCE TUESDAY | MAR 18, 2025

18

Stocks rally as China unveils consumer plan o But economists warn ‘mercurial American

No stability risk from Hungarian house price surge: Central bank BUDAPEST: A surge in Hungarian house prices is driven by investors rather than borrowers and is therefore less risky to financial stability, the central bank told Reuters. Any tightening of credit standards would have a limited impact on prices, the bank said. The bank was responding to a survey by real estate company ingatlan.com that said prices in the capital Budapest jumped by 17% year-on-year in February, the fastest pace in three years. This had been fuelled by retail government bond holders funnelling some savings into the housing market, the survey said. No cooling off was on the horizon as house prices were climbing faster than incomes or rental costs, the central bank said. “The increase in demand in the housing market is driven not primarily by credit growth, therefore, it is less risky from a financial stability aspect,”it said in an e-mailed reply to Reuters questions. Hungarian house prices have more than tripled between 2010 and the third quarter of 2024. The central bank said households’ stock of mortgages as a percentage of economic output was among the lowest in the EU, while a majority of housing market transactions were financed without borrowing. – Reuters The world’s largest memory-chip maker already acknowledged in October that it was facing a “crisis”, and admitted questions had arisen about its “fundamental technological competitiveness and the future of the company”. “Samsung is facing a do-or-die survival issue. We need to reflect deeply from the top,”chairman Lee Jae-yong was quoted as saying during a training for top executives, Yonhap reported. Lee’s message was to emphasise“what matters is not the crisis itself, but the attitude in dealing with it”, Yonhap reported, citing company sources. “Even if it means sacrificing short-term profits, we must invest for the future,” he reportedly said. A Samsung spokesman told AFP yesterday Lee had not “said the message himself” without giving further details. – AFP Thailand approves 90b baht of investments in data centres, cloud services BANGKOK: Thailand has approved 90.9 billion baht (RM12 billion) worth of investments in data centres and cloud services, its investment board said yesterday, the latest additions to the country’s expanding tech sector. The projects include data centres from China’s Beijing Haoyang Cloud & Data Technology, Singapore-based Empyrion Digital, and Thai company GSA Data Center 02, it said. Beijing Haoyang’s plan in Thailand includes a 300 megawatt data centre, valued at 72.7 billion baht, while the Thai firm has proposed a 13.5 billion baht investment for a 35 MW data centre. An AI boom has led to a rush to build infrastructure in Southeast Asia, including data centres that house computer servers and equipment that companies use to process and store data. – Reuters Samsung needs ‘do-or-die’ mindset, says chairman SEOUL: Samsung Electronics must adopt a “do-or-die”mindset, its chairman told executives, to confront the challenges posed by artificial intelligence that are upending the industry, Yonhap news reported yesterday. South Korean giant Samsung has been struggling to meet Nvidia’s requirements as rival SK hynix has become the US titan’s main supplier of high-bandwidth memory (HBM) chips for its AI graphics processing units (GPU).

post-Covid weakness that has been a major drag on economic growth. The State Council unveiled a set of initiatives on Sunday that aim to “promote reasonable wage growth by strengthening employment support in response to economic conditions”, according to state news agency Xinhua. The plan looks to boost income with property reforms, stabilise the stock market and encourage lenders to provide more consumption loans with reasonable limits, terms and interest rates. Officials were also looking at raising pension benefits, establishing a childcare subsidy system, and ensuring workers’ rights to rest and holidays are legally protected. The move comes after data showed consumer prices dropped into deflation in February for the first time in a year, while producer prices continued to fall. However, observers warned that leaders had a tough job ahead of them amid Trump’s trade war. “While fiscal spending targeting domestic demand has expanded, government support is limited,” said economists at Moody’s Analytics,

adding that “mercurial US economic policies are set to drag on global trade and hit China”. “With China firmly in US President Donald Trump’s sights, deflation concerns in China will worsen. The chaos of tariffs and rising unemployment will keep consumer spending weak, denting inflation’s demand drivers. “Manufacturers will have to look closer to home to sell tariff-targeted products. That combination – weaker demand and more domestic supply – will be a handbrake on price growth.” Data yesterday provided a little support, with retail sales up slightly more than expected in the first two months of the year, while industrial production also topped estimates. Hong Kong gained to build on a blockbuster start to the year fuelled by a chase into China tech giants, while Shanghai, Tokyo, Sydney, Singapore, Seoul, Taipei, Mumbai and Manila also enjoyed healthy buying. London and Paris edged up at the open while Frankfurt was flat. Gold was sitting around US$2,985 per ounce, having broken to a record high near US$3,005 on Friday. – AFP

economic policies’ set to drag on global trade

HONG KONG: Markets rose yesterday as investors welcomed Chinese plans to kickstart consumption in the world’s number two economy, though worries about Donald Trump’s tariff war continue to cast a shadow over trading floors. The gains follow a much-needed rally on Wall Street on Friday that was stoked by optimism US lawmakers would pass a spending bill to avert a painful government shutdown. Later on Friday, the lawmakers passed the spending bill that will keep business going through to September. Eyes were on Beijing as officials were set to outline their plans to kickstart spending by the country’s army of consumers after years of

A customer shopping for tomatoes at the vegetable section of a supermarket in Beijing. – REUTERSPIC

Indonesia posts wider-than-expected trade surplus

JAKARTA: Indonesia’s trade surplus was bigger than expected in February as a surge in palm oil shipments bolstered exports, data showed yesterday, extending a strong start to the year even as the spectre of tariff wars dimmed the outlook for global trade. On top of the uncertainty created by US tariffs, changes to Indonesia’s domestic policy settings could also hurt mining shipments in the months ahead, some economists warned. The February surplus of US$3.12 billion (RM13.9 billion) was larger than the US$2.45 billion forecast by analysts in a Reuters poll, and followed an upwardly revised US$3.49 billion surplus in January, the statistics department said. Exports rose 14.05% in February from a year earlier to US$21.98 billion, quicker than the 9.1% rise expected by analysts in the poll.

The value of crude and refined palm oil exports jumped nearly 90% in February from a year earlier to US$2.27 billion. Prices of the edible oil have risen in recent months on expectations of tight supply. In volume terms, shipments rose by an annual 45% to 2.06 million metric tonnes. Exports of precious metals, jewellery and nickel metals also rose, helping offset a drop of nearly 20% in coal exports, which the statistics bureau said was due to both lower prices and volumes, as well as a 6% decline in oil and gas shipments. By value, February coal exports were worth US$2.08 billion, the lowest in three years. Imports by Southeast Asia’s largest economy were US$18.86 billion in February, up 2.3% on a yearly basis, compared with a 0.6% increase

expected in the poll, supported by a 24% surge in vehicles and spare parts imports. Hosianna Situmorang, an economist with Bank Danamon, said the trade data outlook would be coloured by Jakarta’s proposal to hike royalty rates across commodities like coal, nickel, copper, gold and tin, which came as some commodity prices were declining. “These measures add financial strain to the mining sector ... potentially weakening Indonesia’s trade surplus and deterring investment,”she said. Exports of coal and nickel metals made up nearly 20% of total shipments last month. Bank Permata’s economist Josua Pardede said imports would likely rise further due to the government’s pro-growth policy, while exports would struggle amid escalating trade war tensions. – Reuters