Quoteworthy: "We are in this for as long as it takes to get inflation down." — Federal Reserve vice chair Lael Brainard said that the US central bank will have to raise interest rates to restrictive levels
Singapore July retail sales increase
Singapore’s retail sales expanded by 13.7% y-o-y to $3.9 billion for the month of July.
Of the total sum, the number of sales made online stood at 12.7%.
Within the retail trade sector, most industries recorded y-o-y growth in sales. This was led by growth in the wearing apparel & footwear industry at 68.3%, the food & alcohol industry at 53.1% y-o-y and department stores at 42.9%.
The surge in retail sales for the wearing apparel & footwear industry was partly attributed to the higher demand for bags and footwear.
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In contrast, sales of motor vehicles, and supermarkets & hypermarkets saw the highest declines at a respective –13.3% and –5.8% y-o-y.
The lower sales of motor vehicles corresponded with the lower certificate of entitlement (COE) quota this year. The lower supermarkets & hypermarkets sales, as well as the lower mini-marts & convenience stores sales (–5.3%) were due to the higher demand for groceries in July 2021, during the “heightened alert” period.
Accordingly, July registered a growth of 18.1% y-o-y excluding motor vehicles, with a sales value of $3.4 billion.
See also: ECB’s Schnabel sees only limited room for further rate cuts
On a seasonally adjusted m-o-m basis, Singapore’s retail sales grew by 0.6% overall and 0.5% excluding motor vehicles.
Meanwhile, sales of F&B services grew by 41.9% y-o-y and 0.1% m-o-m to a total sales value of $939 million.
Of the total F&B sales, 26.2% came from online.
The significant growth in the F&B industry was mainly attributable to the low base in July 2021, when there were dining-in restrictions as part of the heightened alert measures.
Within the F&B services sector, all industries saw y-o-y growth in sales in April, led by food caterers, which surged by 133.0%.
The surge was due mainly to higher demand for both event and in-flight catering with the easing of restrictions.
Similarly, sales at restaurants, fast food outlets as well as cafes, food courts & other eating places increased by 76.8%, 22.1% and 11.5% y-o-y in July. — Felicia Tan
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Singapore hunts for global ‘rainmakers’ with new expat visa
Singapore will not limit the number of applicants for its newest work permit, Minister of Manpower Tan See Leng said, as the city-state seeks to burnish its appeal to the best minds globally.
The introduction of the Overseas Networks and Expertise (ONE) pass last week as well as other steps that make it easier to hire expats are a response to the tight labour market, Tan said in an interview with Bloomberg Television’s Juliette Saly on Sept 5. The city-state’s officials have mentioned that they see the competition heating up with the likes of London and Dubai.
“What we are really hoping to bring to Singapore are the rainmakers,” Tan said, referring to the efforts to attract leaders in fields across science, technology, engineering and math, as well as finance, arts, culture and sports. “It is an offensive strategy for us.”
The ONE pass — a visa that will allow its holders as well as their partners to work for five years — is Singapore’s renewed effort to lure global talent after its pandemic-era restrictions and efforts to protect local workers made it appear less welcoming. As economies reopen and find growth still stuttering, nations including the UK, the UAE, Germany and Thailand are seeking out top achievers to power their recovery by providing easier access.
“In the competition for talent, we’re in a very, very hyped-up mode,” Tan told a panel of Bloomberg editors and reporters separately. “There’s hyper competition, and we are very careful about what we reveal, because we’re not going after the numbers. We’re going after really the quality — it’s not the quantity.”
Boosting innovation and increasing productivity are key for Singapore as it seeks to raise manufacturing value-add by 50% and annual exports to $1 trillion by 2030. That target would be difficult at the current rate of expansion, with estimates compiled by Bloomberg showing the economy will probably grow 3.7% this year, among the slowest rates in Southeast Asia, with the pace seen easing further to 2.8% next year.
The minister suggested the government was willing to pull out all the stops to support growth, and he signalled some flexibility with regards to accommodating LGBTQ+ workers and their partners to live and work in the city-state. He said the prevailing immigration laws that are “very pro-family” would not be a hurdle to allowing entry of leaders in the identified fields.
“When you talk about this new pass that we’re targeting, I don’t think there is a specific quota or number,” he said, adding: “These are people that are really in the top space itself. I think we would be able to manage those kinds of applications.”
Tan’s comments follow Prime Minister Lee Hsien Loong’s speech last month, where he said the government will repeal a colonial-era law that criminalises sex between men, while pledging to protect the nation’s definition of marriage, which excludes same-sex unions. — Bloomberg
Bitcoin poised to escape from tightest range in two years
The cryptocurrency market appears by some measures to be poised to break out of the narrowest trading range in almost two years.
Based on one gauge, the leverage ratios for the two largest tokens by market value — Bitcoin and Ether — are at the highest on record even with prices of both down more than 50% this year. That is calculated by taking the amount of open interest for perpetual swap contracts and dividing that by the amount of coins held in reserve on exchanges, according to blockchain data-site CryptoQuant.
“Folks think the market has stabilised and are willing to make bigger speculative positions,” said Darius Sit, co-founder of Singapore-based crypto investment fund QCP Capital, who pointed out that traders who see a so-called tail risk — or the chance of a loss happening due to a rare event — are “getting priced out.”
Crypto traders tend to favour perpetual contracts — which, unlike traditional calendar futures, do not expire — in part, because it allows them to keep highly leveraged positions in place.
Bitcoin, which accounts for about 40% of the estimated market value of all cryptocurrencies, traded last week within a range of about 5.4%, the narrowest since October 2020, data compiled by Bloomberg show. The lull two years ago was followed by a months-long surge in prices that eventually pushed Bitcoin to a then-record high in April 2021.
Cryptocurrencies have stagnated since June, when prices tumbled in the aftermath of the collapse of the Terra stablecoin ecosystem, the demise of hedge fund Three Arrows Capital and the bankruptcies of Voyager Digital and Celsius Network.
Bitcoin advanced 0.8% to US$19,900 ($27,957) as of 7.07 am in New York on Sept 6, while Ether was up 4.3% at US$1,666.
Despite recent hawkish comments from the Federal Reserve about inflation and the economic slowdown continuing to weigh on riskier assets including crypto, more traders appear to be putting on bullish leveraged bets.
Overall, the biggest catalyst of the growing leverage is likely the highly anticipated upgrade on the Ethereum blockchain later this month. The most commercially important network is set to move from its current system of using miners to a more energy-efficient one using staked coins. Data collected by blockchain research firm Kaiko show that perpetual swap contracts’ open interest denominated in Ether reached an all-time high at the end of August.
“As we get closer to the Merge, ETH leverage will continue to build up,” said Shiliang Tang, chief investment officer at crypto asset investment firm LedgerPrime.
At the same time, funding rates for both Bitcoin and Ether perpetuals have turned negative in the past few weeks, according to data-site Skew. Exchanges use the so-called funding rate — or the cost to trade — to tether the contracts to their underlying spot price. When the rate is positive, those who hold long positions pay interest to investors who are short, and vice visa.
Kaiko estimated that traders are biased to the downside because they are either betting on an unsuccessful or delayed transition of Ethereum to proof of stake or are hedging long spot Ether positions ahead of the merge.
“The growth of leverage with more bears could result in a short squeeze, as over-leveraged bears get liquidated if prices move up,” said Andrew Tu, head of growth for crypto algorithmic-trading firm Efficient Frontier, which takes neutral positions in trading. — Bloomberg
