Week III April 2020 Latest Publisher and Economic Events Color the movement of regional and domestic markets in the past week. Dri summarizes a number of main points that are considered to affect market performance, as follows: Indonesian economy From the Indonesian economy, Indonesia`s trade balance experienced a surplus of USD 0.74 billion in March 2020 lower than the previous month who experienced a surplus of USD 2.34 billion. The surplus in March was driven by an increase in export performance (USD 14.09 billion) which was greater than the import performance (USD 13.35 billion). Indonesianbank Indonesia in RDG on April 13-14 2020 decided to maintain the BI7DRR interest rate of 4.50%, Facility deposit rates are 3.75% and lending facility interest rates of 5.25%. This policy was taken by considering the importance of maintaining external stability and the stability of the rupiah exchange rate amid the uncertainty of the global economy. Bank Indonesia also took a policy of reducing the Minimum Mandatory Current Current (GWM) of 200 BPS each for conventional commercial banks and 50 bps for sharia commercial banks as one of the quantitative easing instruments in supporting national economic recovery from the impact of COVID-19. In addition, BI raised the ratio of macroprudential liquidity (PLM) by 200 bps for conventional commercial banks and 50 bps for sharia commercial banks which came into force on May 1, 2020. On April 17, 2020, the Minister of Finance delivered the details of the 2020 APBN until the end of March experienced a deficit amounting to Rp. 76, 4 trillion or 0.45% of GDP. However, the deficit realization rate is far below the initial target of the 2020 APBN of 1.76%. The deficit occurs because the realization of state revenue (Rp. 375.9 trillion) is lower than state spending (Rp. 452.4 trillion). From the price of commodity, the price of WTI crude oil fell by almost 30% to its lowest level of USD 13.01/barrel in trading date April 20, 2020, this is the lowest level since March 1999 (in the last 21 years). This decrease occurs due to investor concerns about the adequacy of US storage capacity amid a decline in global demand due to the spread of COVID-19. Meanwhile the price of Brent oil dropped by 2% to USD 27.4/barrel. OPEC+ agreement to pruning oil production of 9.7 million barrels/day has not shown an effect on the price of crude oil. The price of gold fell to 0.5% to USD 1,675/ounce at the end of trading on April 20, 2020 after the US President plans to reopen the US economy gradually. Japanese economy From the Japanese economy, the production of the Japanese industrial sector fell 0.3% Mom in February 2020 after the previous month rose 1.9% Mom. This is the first contraction since November 2019, the decline was caused by the spread of COVID-19 in several countries so as to disrupt the global economy. Production drops on transportation equipment (-5%) and food and tobacco (- 0.8%). Meanwhile, a high increase in production occurs in organic and inorganic chemicals (6.2%). European economy From the European economy, the production of the European region industry fell 0.1% in February following a 2.3% growth in January 2020. Meanwhile, the annual European region inflation rate in March 2020 increased by 0.7%, the lowest since October 2019. This was due to the covid outbreak -19 and oil price war between Saudi Arabia and Russia. Chinese economy From the Chinese economy, China`s economic growth in the first quarter of 2020 contracted 6.8% yoy, after growing 6% in the last three months in 2019. This is the first contraction since China recorded yoy`s economic growth in 1992, the contraction of the economic growth showed the slowdown of China`s economy As a result of the distribution of Covid-19 which made economic activity stopped for two months. The decline occurred in all sectors, namely the industrial sector down 9.6%, the service sector fell 5.2%and the primary sector fell 3.2%. China`s trade balance in March 2020 narrowed to USD 19.9 billion from USD 31.5 billion in the same month the previous year , the decline in exports and imports that occur is under the estimated market due to the re -operation of factories in China the effect of lockdown policies. During the first three months of 2020 the total Chinese trade surplus of USD 12.8 billion. Direct investment (FDI) to China fell 10.8% (yoy) to CNY 216.19 billion (USD 31.2 billion) in the first quarter of 2020 due to the plague Covid-19. The increase in investment only occurred in two sectors, namely the Information and Technology sector (15.5%) and the accounting sector in the service industry (29.9%). Chinese retail sales fell 15.8% yoy in March 2020, following a sharp decline of 20.5% yoy in January -February 2020. This is due to consumers who remain careful about the impact of the Covid-19 even though the Chinese government has revoked the lockdown policy. The production of the Chinese industry sector has fallen by 1.1% yoy in March 2020, after throughout January-February dropped sharply by 13.5% . This is the effect of the lockdown policy revoked by the Chinese government because of the end of the Covid-19 outbreak so that economic activities began to rise again. From the housing sector, the average price of the new house in China increased 5.3% yoy in March 2020, this was the lowest since the month July 2018. The price decline is due to the spread of COVID-19, where consumers do not carry out activities outside the home and transaction activities. United States economy The price of US import commodities fell by 2.3% Mom in March 2020 following a decrease of 3.2% Mom in the previous month. This is the decline in the largest import price since January 2015, the decline in fuel prices by 26.8% is a driving factor. Meanwhile, the price of export commodities fell 1.6% mom in March following a 1.1% mom decrease in the previous month. US retail sales decreased 8.7% mom in March 2020 after the previous month experienced an increase of 0.4% mom in February 2020. Occurs is the highest in the US economy record, this happens because consumers reduce their purchases on vehicles and spare parts, furniture, electronics, building materials, health products and clothing. Meanwhile the increase was recorded on the purchase of food and beverages and other health care. The total production of the industrial sector in the US fell 5.4% Mom in March 2020, this was the biggest decline since January 1946. This was influenced by a decrease in manufacturing output by 6.3% as a result Spread of Covid-19 which causes factories to stop operating. From the US housing sector, the indicator of the Housing Developer Sentiment-Nahb Housing Market Index fell to the level 30 in April 2020 from the level 72 in March. This decline was the lowest since June 2012. Optimism of US developers was slightly eroded in line with the expectations of house sales that weakened in the next 6 months this was seen from its sub -index which decreased to 36 out of 75 in March. On the other hand, the building permit fell 6.8% Mom to 1,353 million units (SA Annual Rate) in March 2020, was the sharpest decline since July 2015. The massive distribution of Covid-19 in the US resulted in a large influence on the sector construction. Meanwhile, the construction of new housing in the US fell 22.3% Mom to 1,216 million in March 2020 and is the lowest since July 2019, sales for single-family which became the largest segment dropped 17.5% to 0.856 million while the segment for multi-family fell sharply by sharp amount 31.1% to 0.347 million. From the labor sector, the unemployment allowance claims increased by the last 5,245 million on April 11, 2020, down from the previous week by 6,615 million. In total in one month (March 11 - April 11, 2020) there are 22 million unemployment allowances in the US. Week IV April 2020 Some economic indicators that need to be observed next week, among others * USA: Existing Home Sales, Initial Jobless, Markit Manufacturing PMI, New Home Sales, Durable Goods * Japan: Trade Balance, Jibun Bank PMI (Manufacturing & Services), Inflation Rate (Yoy) * EU: Consumer Confidence, Markit Manufacturing PMI Source: Danareksa Research Institute Figure: Walakiri Beach, Watumbaka, East Sumba Regency, East Nusa Tenggara, Indonesia Photo by Febiyan On Unssplash