Haver Analytics
Haver Analytics


Tian Yong Woon

Tian Yong joined Haver Analytics as an Economist in 2023. Previously, Tian Yong worked as an Economist with Deutsche Bank, covering Emerging Asian economies while also writing on thematic issues within the broader Asia region. Prior to his work with Deutsche Bank, he worked as an Economic Analyst with the International Monetary Fund, where he contributed to Article IV consultations with Singapore and Malaysia, and to the regular surveillance of financial stability issues in the Asia Pacific region.

Tian Yong holds a Master of Science in Quantitative Finance from the Singapore Management University, and a Bachelor of Science in Banking and Finance from the University of London.

Publications by Tian Yong Woon

  • In this week's newsletter, we revisit some pivotal themes related to Japan. We begin by assessing the country's recent inflation trends, specifically highlighting the latest CPI figures from Tokyo and their potential impact on nationwide inflation and monetary policy. Next, we examine Japan's current macroeconomic landscape, acknowledging the slowdown in retail sales and industrial production, alongside a worsening outlook suggested by recent PMI readings. However, we also recognize the significant growth in corporate capital expenditure in Q4 and investigate the potential consequences of this unexpected positive development on Japan's Q4 GDP. We move on to analyze the ongoing rally in Japan's equity market, underscored by earnings growth and robust investment from foreign investors. Shifting gears, we delve into the recent performance of Japan's semiconductor industry, which has experienced a surge in production and exports, fueled by the global demand for AI chips. Finally, we explore Japan's long-term demographic challenges, focusing on workforce trends and the increase in foreign workers.

    Tokyo inflation Markets have continued to scan data prints and official comments for cues ahead of the Bank of Japan’s (BoJ) upcoming monetary policy decision on March 19. Among the recent flurry of economic data was Tokyo’s core CPI, which jumped to 2.5% y/y in February, as base effects from Japan’s utility subsidy programme faded. The Japan government implemented support measures in early 2023 to help households tackle rising costs brought about by Russia’s invasion of Ukraine and a weakening yen. Among the measures include subsidies of about 20% on consumer electricity bills. Stripping away energy-related price effects, however, underlying inflation in Tokyo continued to cool, having moderated to 3.1% from 3.3%. As such, it remains to be seen if Tokyo’s latest inflation developments, if reflected in nationwide inflation numbers, are supportive of imminent BoJ policy tightening. Of possible concern is non-fresh food and non-energy inflation, which has remained on a downward trajectory since late 2023.

  • In this week's letter, we review some recent developments in Asia. Starting with Japan, we examine the implications of its underwhelming Q4 GDP result while noting the recent further weakening of the yen. Shifting next to China, we discuss its strong domestic tourism numbers during the Chinese New Year holidays and examine recent equity market movements. Next, we turn our attention to Indonesia’s recent general elections, noting the generally positive reactions observed in domestic markets so far. Lastly, we look at the Philippines, giving a nod to its latest interest rate decision and acknowledging the latest progress on disinflation.

    Japan and the yen Japan encountered an unforeseen dip in its real GDP, with a decline of 0.1% q/q in Q4 2023. This marked the second consecutive quarter of contraction, signifying a technical recession. The downturn can be partially attributed to ongoing weaknesses in private consumption, though the negative impact was somewhat mitigated by net exports. Despite this, the economy still achieved an annual growth of 1%, although this was lower than the 1.7% growth observed in Q3. Japan’s disappointing Q4 performance, coupled with a much weaker yen, led to the economy’s displacement by Germany as the world’s third largest (chart 1). Previously, Japan’s economy was second only to the United States, until it was overtaken by China’s in 2010.

  • In this week's letter, we shift our focus to Japan, covering topics such as monetary policy, inflation, wages, the property market, and recent movements in asset prices. We first note recent investors’ views on the forthcoming actions of the Bank of Japan (BoJ), taking into account recent communications and inflation trends. We then delve into inflation disparities within the regions of Japan. We next examine Japan’s residential property market, and acknowledge the recent acceleration in sales prices and rental rates. We then discuss developments relating to the upcoming spring wage negotiations, highlighting key announcements and commitments made so far. Finally, we examine the latest trends in Japanese equities and the yen, observing the ongoing rally in stocks amidst a renewed decline in the currency's value.

    Monetary policy The Bank of Japan (BoJ) left its policy settings unchanged in January, as widely expected. The central bank also revealed updated economic forecasts, indicating expectations of slightly firmer GDP growth and lower CPI inflation (excluding fresh food) for the fiscal year ahead. Perhaps more interestingly, the BoJ noted that the likelihood of realizing its price stability outlook has gradually risen. Some analysts interpreted the remarks as hints at imminent policy normalization, with a few now seeing BoJ rate hikes commencing from as early as March. Others, however, remain skeptical of substantive BoJ policy rate hikes soon, noting factors such as the lingering economic damage from Japan’s recent earthquakes. With that said, recent central bank messaging has lately hinted at possible tightening moves via the ending of risky asset purchases, but leaned against rapid interest rate hikes.

  • In this week's letter, we evaluate recent developments in Asia’ supply chains and trade. First, we analyze the consequences of ongoing disturbances in the Red Sea, observing a temporary reduction in freight and bunker fuel prices following their initial surges. Our discussion then turns to the potential effects of these developments on Asia, highlighting that supplier lead times have remained largely unaffected thus far. We further investigate the breakdown of geographical sources of imports for the region, pointing out that the predominance of intra-Asia trade could serve as a buffer against disruptions in sea routes elsewhere. We also expand our analysis to include a wider perspective on the semiconductor industry, recognizing Asia's contribution to the resurgence in global sales. Finally, we shed light on the varying growth rates of semiconductor exports among Asian countries.

    Impacts of Red Sea disruptions so far The Baltic Dry Index (BDI), a composite of dry bulk shipping costs, surged to historic highs during the initial waves of Houthi attacks in early December (chart 1). That said, the index quickly normalized after sentiment stabilized and as shipment re-routings were underway. In contrast, the Drewry World Container Index (WCI), which captures shipping costs associated with eight major east-west routes, only surged in early January. The surge was driven by costs relating to routes that often require passage through the Red Sea (e.g., between Shanghai and western cities). Nonetheless, the WCI has already started to show signs of peaking, as prices moderated in early February.

  • In this week’s letter, we examine China and India – the world’s two most populous economies. We first take stock of developments in monetary policy, noting China’s continued inclination toward more easing while India keeps policy tight to contain inflation. We also note, however, still weak credit demand in China despite recent easing moves, and strong loan growth in India despite recent tightening moves. We look next at equity market performance in these two economies, noting the divergence between investor pessimism about China and continued optimism regarding India. Next, we assess longer-term demographic issues, highlighting China’s challenges with a rapidly aging population, in stark contrast to India’s relative youth. We end this week’s discussion with a shift to the advanced Asian economies of Taiwan and South Korea, noting persistent manufacturing weakness in the former. And we give a nod to the significance of semiconductors in these economies’ exports, acknowledging, in particular, their recent rebound in South Korea.

    Monetary policy in China and India The People’s Bank of China (PBoC) cut the one-year medium-term lending facility (MLF) rate by 45 bps over 2022 and 2023 (chart 1) to support a struggling Chinese economy. The MLF rate cuts in turn dragged on the one-year and five-year loan prime rates (LPR), which serve as reference rates in the credit market. More recently, the PBoC announced that it will cut the reserve requirement ratio (RRR) for banks by 50 bps, effective 5 February. The central bank’s governor said the move will unleash about 1 trillion yuan ($140 billion US dollars) of liquidity into China’s financial system. The PBoC has already enacted numerous RRR cuts in recent years, in a bid to boost growth by easing monetary and credit conditions. It remains to be seen, however, if the latest easing moves can alleviate the challenges China currently faces, given the structural roots of China’s economic problems.

    In contrast, the Reserve Bank of India (RBI) has pursued policy tightening over recent years, having raised policy rates by 250 bps to combat inflation. As a result, India’s policy repo rate and marginal standing facility rate have been lifted to late-2018 levels, of 6.5% and 6.75% respectively. Also, the standing deposit facility rate was lifted to 6.25%. India, like many other emerging Asia economies, has experienced price pressures from food and energy costs, prompting the RBI to raise interest rates.

  • In this week’s letter, we dive into some of the key themes relating to the ASEAN-5 region, including topics on inflation, monetary policy, tourism, trade, and global value chains. For clarity, we define ASEAN-5 economies to comprise Indonesia, Malaysia, Singapore, Thailand, and the Philippines. We note that while inflation has moderated in the region, developments at the country level have been uneven. We also take stock of recent monetary policy trends noting that the region’s central banks seem likely to hold policy rates steady until inflation cools further. Next, we examine tourism, acknowledging the absence of a strong recovery in Chinese tourist arrivals amidst persistent economic troubles at home. We next move to trade, noting the interim stabilization of the region’s exports and explore recent developments in the region’s trade relationship with China. Lastly, we take stock of the region’s standing in global value chains, by examining the value they add to their exports. Also included in the last segment is a nod to the slew of government initiatives aimed at catapulting their respective economies toward innovation and new technologies.

    Inflation Headline CPI inflation has cooled significantly in ASEAN-5 economies over the past year on average (chart 1), as food and energy price pressures eased. Average headline ASEAN-5 inflation has fallen to 2.3% y/y in November 2023, from a peak of 6.2% in September 2022. Meanwhile, average core ASEAN-5 inflation moderated to 2.1%, after having peaked at 3.7% in January 2023. Delving deeper, however, we find that progress on disinflation has been uneven across the ASEAN-5 economies. For instance, headline inflation in the Philippines remained comparatively high at 4% in December 2023 despite having cooled from its peak of 8.7% in January 2023. In contrast, Thailand remained in deflation for a third straight month in December 2023, with prices having fallen 0.8% y/y for the period. Nonetheless, price pressures in ASEAN-5 as a whole are likely to be suppressed further if current monetary policy settings are maintained. With that said, inflation risks remain. For one, near-term supply-side bottlenecks induced by regional conflicts (e.g., Russia-Ukraine, Israel-Hamas) may exert external-led price pressures. Also, an eventual rebound in domestic demand in ASEAN-5 may add to domestic inflationary pressures.

  • In this week’s letter, we investigate the Australian economy, a major producer of various global commodities, including iron ore, copper, and lithium, among others. We start by looking at recent monetary policy developments in Australia, against a backdrop of still-high inflation. We next examine trends in Australia’s household sector, taking stock of slowing consumption growth and moderating debt levels. Closely tied to household debt is the property sector, which has started to see firmer prices again after a respite in early 2023. We then touch on Australia’s labour market, which remains tight but with persistent real wage losses due to high inflation. Lastly, we look at Australia’s trade, with a focus on China, a key trading partner. We note strong growth in Australia’s exports to China, aided in part by iron ore, amid slowing shipments to advanced Asian economies.

    Monetary policy Australia has undergone significant monetary tightening in recent years to tackle inflation. Specifically, the Reserve Bank of Australia (RBA) has raised its policy rate by a total of 425 bps since April 2022, 125 bps of which occurred in 2023 (chart 1). Headline CPI inflation has cooled significantly since, to 4.3% y/y in November 2023, from a peak of 8.4% in December 2022, as pressures from food and housing prices cooled. With that said, consumer inflation remains far from the RBA’s target of between 2% and 3%, making RBA rate cuts unlikely, at least in the immediate months ahead.

  • In our final Charts of the Week publication for 2023, we turn our attention to 2024, and highlight twelve themes that are poised to influence the economic and financial market landscape in the year ahead. These include several cyclical themes that concern, for instance, inflation, monetary and fiscal policy settings (see charts 1 to 4). The outlook for China’s economy and India’s economy could also remain significant (charts 5 and 6). We then turn our gaze to more structural matters such as the advance of AI (chart 7) and ageing demographics (chart 8). Politics, however, will also be critical next year with more than half of the world’s population destined to vote in elections, including of course the US (chart 9). The latter, in turn, though could have profound implications for trade (chart 10) and geopolitical stability (chart 11). Our final theme is climate change and the energy transition which will also never remain too far from the headlines (chart 12).

  • In this week’s letter, we take the opportunity to reflect on the year, with a focus on key developments in the Asia Pacific region. We note that regional disinflation has finally materialized, aided by a decline in energy prices and as cumulative effects of past monetary tightening take hold. Further, we take stock of monetary policy in the region, with one camp of central banks potentially having concluded their tightening cycles, while another camp keeps policy easy, due to less-than-ideal economic conditions at home. Next, we evaluate regional currency performance, and with a nod to effects from monetary policy. We give a nod to equities in the region as well, noting however the headwinds that continue to drag on returns. We also examine shifting trade dynamics between China and other Asian Pacific economies, acknowledging continued export woes in South Korea, and increased shipments by Australia and Vietnam. Lastly, we delve into the state of tourism in the region, acknowledging the enduring gap left by Chinese tourists who have not returned and the measures being taken by regional governments to encourage their comeback.

    Inflation developments Headline inflation in the Asia Pacific region cooled rapidly in early 2023, partly due to a sharp drop in energy prices (chart 1), while tighter monetary conditions weighed on domestic demand in some economies. Notably, both China and Thailand recorded their first post-pandemic deflation readings in July and October, respectively. Thailand’s headline inflation was dragged lower additionally by recent measures enacted by the new government, aimed at lowering living costs via diesel tax cuts, reduced electricity bills, and similar measures. However, apart from China and Thailand, relatively high headline inflation rates persist in the Philippines, India, Australia, and Singapore, despite easing price pressures. In the third quarter, there was a resurgence in inflation due to a rebound in crude oil prices, although a subsequent price correction suggests that these inflationary pressures may soon subside.

  • We move our attention this week to Indonesia, in light of its Q3 GDP readings released last week. The resource-rich economy is the largest in Southeast Asia and the fifth-largest in Asia by GDP, providing the bulk of the world’s nickel and palm oil supplies. Indonesia is also an important producer of other base metal and agricultural products including tin and natural rubber, and of energy commodities like coal. While slightly weaker, Indonesia’s Q3 GDP growth hovered near pre-pandemic rates, with private consumption once again the main growth driver. Delving deeper, we note continued weakness in Indonesia’s exports, which have been weighed by soft export prices despite relatively steady demand volumes. We then turn to examine Indonesia’s position as a minerals producer and its efforts – including outright export bans – to ascend the global minerals value chain. We next take stock of recent developments with the Indonesian rupiah and its relative resilience against the US dollar, noting stabilization support from the central bank. Lastly, we dive into the bank’s newly minted monetary policy tool aimed at attracting foreign inflows and discuss preliminary market responses and results.

    Indonesia’s Q3 performance Indonesia experienced slightly slower GDP growth in Q3, of 4.9% y/y, registering its first sub-5% growth reading in seven quarters (chart 1). The main support for Indonesia’s Q3 GDP growth stemmed from private consumption and gross capital formation, which collectively contributed to 4.7 percentage points of growth. Also, net exports provided a slight lift to growth, while government consumption exerted a mild drag.

  • In this week’s letter we focus on recent investor behaviors concerning Asia. We note the recent exodus of investor funds from the region, driven largely by outflows from Mainland China amid lingering uncertainties. We also examine investor pivots toward other areas in the region, including India and Vietnam, and note the distinct pull factors of those economies. India has become an increasingly attractive investment destination for portfolio flows, with opportunities supported by a relatively stable rupee and a still-positive yield spread over the United States. Vietnam continues to draw investment flows from all over the world, spurred by its manufacturing infrastructure and comparatively low labor costs. Finally, we give a nod to the latest yield developments in Japan, following the central bank’s decision last week to officially demarcate 1% as the upper 10-year yield limit.

    Foreign portfolio equity flows Foreign investors unwound about $15.6 billion of equity positions in Asia over September, after having already sold $20.2 billion of assets in August (chart 1). Almost all of the recent equity divestments are of Mainland China assets, with significant moves out of Taiwan and South Korea seen too. The selloffs come in contrast to the optimism displayed earlier this year when the major investment thesis for emerging Asia was about maximizing exposure to China’s reopening. Now, we have seen such optimism fade, with investors increasingly turning to other pockets of opportunity, such as India and Vietnam.

  • This week we turn our attention to South Korea after it revealed an improved economic outturn for Q3 just last week. The economy’s rebound was driven in large part by its semiconductor industry as global chip demand recovered some poise over the period. With that said, while the latest news offers some headline reprieve to South Korea watchers, underlying domestic issues persist. In particular, the indebtedness of South Korean households flags continued reason for concern, as mortgage loans surged following the introduction of 50-year loans in July. The fragility of the situation is further underscored by households’ significant floating-rate loan exposures amid a high-interest rate environment, with delinquency rates already rising in recent months. Against this backdrop, we also discuss the challenges faced by the Bank of Korea. With that said, it seems likely that the central bank keep rates higher for longer, for now, until the data justifies otherwise.

    South Korea’s Q3 performance South Korea enjoyed an encouraging turnaround in economic performance in Q3, following three prior quarters of slowing growth. South Korea’s GDP growth rose to 1.4% y/y from 0.9% in Q2 (chart 1), driven by trade, as export growth improved while imports steadied from previous declines. In contrast, growth contributions from private and public consumption were only modest, while capital formation exerted a mild drag.