Vietnam to lead growth in Asia
- The World Bank updated its projection for the economic outlook of East Asia and the Pacific region on Monday. The institution expected the economy of Vietnam to expand by 7.2% in 2022, leading the growth in the region. It also forecasted that China’s GDP would increase by 2.8%, being outpaced by most ASEAN countries except for Laos. It would be the first time since 1990 that China’s growth lags behind the average level of the rest of the region, which consists of ASEAN and Pacific Island states.
- Four Pacific islands countries would remain in contraction territory this year, the World Bank said. These countries are Samoa, the Solomon Islands, Tonga, and Micronesia.
U.S. financial market has ugly day
- Yesterday, the Dow Jones Industrial Average plunged more than 20% from its record high in January, entering the first bear market since March 2020. The S&P 500 touched its lowest since December 2020, and the Nasdaq Composite dropped 0.6%. All three gauges have fallen for five consecutive trading days, with Dow declining 5.67% and the other two down more than 6% during the period.
Yuan weakens to near 14-year low, pound hit record low
- The central bank will raise (Zh/En) the foreign exchange risk reserve ratio for foreign exchange forward trading from zero to 20% from Wednesday. By increasing the costs of forward contracts of foreign exchange, the measure aims to lower the demand for foreign exchange to shore up the yuan. However, economists expect the Chinese currency to continue to depreciate to 7.3 per dollar by the end of this year.
Apple starts making iPhone in India
- U.S. tech giant Apple has started assembling its new iPhone 14 in India, partnering with Foxconn Technology Group. The production transfer marks the latest fallout of China’s strict COVID policy and geopolitical tensions between Beijing and Washington. Global companies have been exploring a “China-plus-one” strategy to diversify their business into countries like Vietnam and India.
North Korea tests missile before U.S.-South drills, Harris visit
- A U.S. carrier strike group led by the USS Ronald Reagan is participating in four-day joint military drills off the east coast of the Korean Peninsula. The aircraft carrier home-ported in Japan entered the South China Sea during House Speaker Nancy Pelosi’s visit to Taiwan in August.
- North Korea tested a short-range ballistic missile on Sunday, soon before the joint exercises started and U.S. Vice President Kamala Harris visits South Korea.
- On Monday, China and the North resumed the cross-border freight train services five months after a suspension due to COVID-19.