Weekly Economic Update. Contents Recent Macroeconomic Developments Commodities Currencies Capital Markets Miscellaneous

Transcription

1 Weekly Economic Update Contents Recent Macroeconomic Developments Commodities Currencies Capital Markets Miscellaneous 1

2 Jan-08 Apr-08 Jul-08 Oct-08 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13 Mar-08 Jul-08 Nov-08 Mar-09 Jul-09 Nov-09 Mar-10 Jul-10 Nov-10 Mar-11 Jul-11 Nov-11 Mar-12 Jul-12 Nov-12 Mar-13 Jul-13 % USD trillions Recent Macroeconomic Developments GLOBAL Weak consumer spending, inflation data point to a soft US economy Consumer spending, which accounts for more than two-thirds of US economic activity, rose by just 0.1% monthon-month in July as workers saw their salaries shrink due to the government spending cuts. On annual basis, however, consumer spending rose by less than 3% in July, compared with 4.1% during the same period last year. With sluggish demand, inflation pressures remained subdued as the consumer price index edged up by only 0.1%, down from a 0.4% in June. Despite the upward revision of the Q2 real GDP growth rate to 2.5%, the lacklustre spending and inflation data would cast some doubts on the speed of economic recovery of the world s largest economy at a time the Federal Reserve is weighing the options of cutting back its $85 billion monthly quantitative easing programme US: Personal income and outlays US Personal Consumption and Inflation -2 Disposable Personal Income Personal Outlays -3 Personal Consumer Spending (%chg y-o-y) -4 Source: Thomson Reuters and Gulf One Investment Bank Inflation Rate (%chg y-o-y) 2

3 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 % SAR trillions Recent Macroeconomic Developments GCC Domestic credit to the private sector remains buoyant Bank lending to the private sector in Saudi Arabia continues to increase apace. Credit to the private sector in the Kingdom increased by 15.6% year-on-year in July to reach SAR 1.10 trillion compared with SAR 944 billion during the same period last year. On a month-on-month basis, however, the growth in bank lending to the private sector was relatively flat, increasing by only 1% in July, according to Jadwa report for September There appears to be considerable variation across the various segments of the private sector, as commerce and the manufacturing sub-sectors were the main beneficiaries of new lending in the first half this year, while at the start of the second half of the year the mining sector received the lion s share of credit to the private sector. Despite the current improvements, a much broader liquidity support is needed to boost the Kingdom s growth rate of non-oil GDP to the pre-2008 global financial crisis level Bank Lending to Private Sector in Saudi Arabia Value(RHS) % Chg yoy (LHS) Source: Thomson Reuters and Gulf One Investment Bank 3

4 30-Jul Jul Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Jul Jul Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug-13 Commodities 119 Brent Oil Price (US$/barrel) 1430 Gold Price (US$/ounce) As August 30, 2013 (US$) Current Week Ago Weekly Change Brent Oil (barrel) Gold (ounce) 1, , Silver (ounce) Copper (pound) Aluminium (kilo) Source: Thomson Reuters 4

5 30-Jul Jul Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Jul Jul Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug Aug-13 Currencies Current (30 Aug 2013) Week Ago Weekly Change International $1 $1 (%) Euro GBP Yen CNY Euro, Yen & Pound vs. Dollar INR CHF Euro (LHS) Pound (LHS) Yen (RHS) GCC AED The Dollar Index BHD KWD OMR QAR SAR Source: Thomson Reuters 5

6 Stock Markets DowJones 1.33% 3680 NASDAQ 1.86% 1670 S&P % CAC % FTSE % Nikkei % Source: Thomson Reuters 6

7 Stock Markets Abu Dhabi 5.44% Doha 4.85% Dubai 6.55% Kuwait 5.82% Muscat 3.03% Saudi 5.20% Source: Zawya 7

8 Stock Markets Stock Exchange Current A Week Ago Weekly Change (30 Aug) (%) Dow Jones (US) 14,810 15, Nasdaq (US) 3,590 3, S&P500 (US) 1,633 1, CAC40 (FR) 3,934 4, FTSE100 (UK) 6,413 6, Nikkei225 (JP) 13,389 13, Abu Dhabi 3,735 3, Bahrain 1,188 1, Doha 9,619 10, Dubai 2,523 2, Kuwait 7,633 8, Muscat 6,692 6, Saudi Arabia 7,767 8, Source: Thomson Reuters and Zawya 8

9 Gulf projects Projects planned or under way Projects planned or under way Change on week (%) Projects planned or under way Change on year (%) 20-Aug Aug-12 ($m) ($m) ($m) Bahrain 62,185 62, , Kuwait 195, , , Oman 146, , , Qatar 259, , , Saudi Arabia 959, , , UAE 707, , , GCC 2,331,195 2,326, ,901, Iran 249, , , Iraq 495, , , Gulf Total 3,076,163 3,073, ,485, Source: MEED 9

10 Gulf One Investment Bank Weekly Economic Update Gulf One Investment Bank B.S.C. (c)(gulf One) is a leading knowledge-based investment bank that is focused on providing professional and high-quality infrastructure related investments for the MENA (Middle East and North Africa) region. Its mission is to mobilise local and global capital to accelerate the realisation of infrastructure projects and corporatisation through innovative financial solutions. Gulf One was jointly founded in 2006 by Dr. Nahed Taher, Co-Chief Executive Officer (Co-CEO), and Mr. Ziyad Omar, Co-Chief Executive Officer (Co-CEO). Headquartered in Bahrain, Gulf One operates under a conventional wholesale banking licence granted by the Central Bank of Bahrain (CBB), CR This Weekly Economic Update has been prepared by staff in the Research Department of Gulf One under the general direction of Dr. Nahed Taher. The Research team comprises: Dr. Mohammed Salisu Chief Economist Gulf One Investment Bank m.salisu@gulf1bank.com Ms. Lobna Bousrih Research Analyst Gulf One Investment Bank l.bousrih@gulf1bank.com All comments and enquiries about this Weekly Economic Update should be sent to Dr. Mohammed Salisu at the above address. Disclaimer This Weekly Economic Update was prepared by Gulf One Investment Bank B.S.C.(c)(Gulf One) and is of a general nature and is not intended to provide specific advice on any matter, nor is it intended to be comprehensive or to address the circumstances of any particular individual or entity. This material is based on current public information that we consider reliable at the time of publication, but it does not provide tailored investment advice or recommendations. It has been prepared without regard to the financial circumstances and objectives of persons and/or organisations who receive it. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. In addition, the views expressed in this Economic Update do not necessarily represent the views of the Management or Board of Directors of Gulf One. This Weekly Economic Update or any portion hereof may not be reprinted, sold or redistributed without the prior written consent of Gulf One. 10