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Strategies & Market Trends : Asia Forum -- Ignore unavailable to you. Want to Upgrade?

To: Zeev Hed who wrote (4152)	6/3/1998 1:33:00 PM
From: tom	Read Replies (2) \| Respond to of 9980

That's the reason why so many US companies have seen blips up in inventory levels in the 1Q98. Korea for example destocked 1/7 of GDP in the 1Q98! yes that's right 1/7 of GDP. It took all its toasters and microwaves off the shelves, blew the dust off and shipped them over to the US and Europe. Note also that although export volumes were up by 30% prices fell and so exports were only up 9% in US$ terms. The 1Q98 export figures for the rest of Asia are terrible. Singapore -6% Malaysia -10% Thailand -2% Indonesia 0% Philippines +24% (but 9% in April) (note that 35% of Philippines exports go to the US cf 20% for the others) HK -1% China 13% Taiwan -5% (Cheap notebooks for Dell) Imports have collapsed across Asia (to the tune of -50%) as they cannot get financing. Now the de-stocking might be over they will have to buy some raw materials - look for a blip up in commodity prices and a fall in Asian currencies (this is a question of "when" not "if") I know that HP has been knocking down its Asian suppliers' prices big time and I'm sure they're not the only ones. Purchasing managers in the US have been buying goods in Asia in the 1Q like crazy at rock bottom US$ prices. Note San Francisco Fed President Parry's comments that the inventory build up in the US in Q1 could way down future growth. Low inflation in the US but perhaps some inventory problems for the tech companies as well?