13/10/2016 Asia Business Report

Now on BBC News, all the latest business news live from Singapore.

Volatile times for Asian currencies. We find out what has been driving

them up and down. And customise clothing without

putting a hole in your pocket. Meet the duo who have a business idea

Down Under. Good morning, Asia, hello, world.

Glad you could join us for this edition of Asia Business Report. It

has been a week of ups and downs. Traders were to see if the US

central bank will deliver a rate hike soon. The US dollar rose

further overnight after minutes from the September meeting revealed the

central bank is moving closer to raising the cost of a wing, with

some members saying it was a close call. -- cost of borrowing. An

update now on how this impacts the currencies.

Ahead of next month's Fed meeting, many of the region's currencies have

been on the downtrend against the greenback. For Thailand, their

currency has been heading south due to domestic political concerns.

Earlier I asked what else is driving them down. Over the past couple of

weeks we've seen a big move up in the dollar against most Asian

currencies and of course some of the G7 currencies. Pretty much in light

of two key events coming up. First, the US presidential elections next

month and of course in the lead up to meetings in November, as well as

in December. So, the US presidential elections are creating uncertainty.

That is the umbrella reason why currencies have weakened. What you

also have domestic concerns, especially in the likes of Thailand,

the Philippines and South Korea are that are hurting the current is even

more? Yes. Some of the Asian currencies we have seen that have

undergone a weakening include the Thai bite, which we have known for

bomb threats Thailand has received. -- two and the help of the king.

From a press police on Sunday, from the royal palace, typically the king

of Thailand is viewed as a political peer who brings together investor

confidence. So are you expecting more weakness for the Thai baht? We

could, as uncertainty looms over the health of the king. The worst

performing currency this year is the Philippines peso. We have seen an

exodus of funds from the stock market. Is it all because of

President Rodrigo Duterte's profanity and outbursts? Pretty much

the way he is conducting his agenda, to weed out corruption, this is

unsettling some of the investor sentiment and confidence. That's

some outflow from the equity markets. Which particular currency

is doing quite well, despite the weakness of some of the Asian

emerging currencies? Is there a standout? It is basically a decline.

The Korean won is now about 2%, but is down about 3%. There is no

particular... We have a meeting coming up tomorrow that is having

some impact as well. That was a senior strategist from

Maybank. In other news:, the chief executive is standing down with

immediate effect. He is seen here testifying at a US Senate hearing

last month. His resignation comes in a week of the scandal over the US

bank was Mac sales practices. It is investigating how 2 million accounts

were opened without customers' permission.

This comes after the South Korean conglomerate announced it would

permanently and sales and production of its fire prone Galaxy Note 7

smartphones. The recall of 2.5 million handsets has led Samsung to

cut its preliminary profit forecast by one third for the three months

until the end of September. The fallout in golf in money flows

to Malaysia's state investment fund on NDD is indeed spreading, with

Switzerland's attorney generals office opening the case. -- 1MDB. In

Singapore, there was an announcement that the merchant bank would be shut

down for allegedly breaching anti- money laundering controls.

Key China trade numbers are due later this morning. The first since

the new yuan was included in the IMF's basket of influential global

currencies. Following the golden week holidays, there is hope the

figures will show the economy is picking up after postings lower

growth in the second quarter. Someone from JP Morgan explained

what has been dragging down the second largest economy in the world.

In the first six months of this year consumption actually contributed 73%

of overall growth and also the service sector is now 54% of GDP,

which is much bigger than manufacturing, only 45%. So the

transition is happening in terms of the sources of growth. But in terms

of the growth rate, it is lower compared to the recent past. 6.5% to

7%, the growth rate that many first world economies would still want to

have. When are they likely to break out of that 6.5% to 7% growth and

move ahead towards 8% or 90 cents growth again, as in the past? I

think is very unlikely. -- or 9%. In the future we expect the growth rate

to stay between 6.5 and 7%. I do think China will go back to the 8% -

10% range, because the size of the economy is a much bigger now

compared to the past. This year the GDP is about 11 trillion US dollars,

the second largest economy in the world. But importantly it is now

contributing between 35% to 40% of global growth. As you said, China's

growth rate is lower compared to ten years ago. The size of the economy

is a much bigger, so therefore the contribution to global growth is

bigger than ever before. If you are after custom-made clothes

in this region, the popular options are in Vietnam or Hong Kong for

their affordability. Now two Australian on the bidders have

started a business doing the same in Sydney. -- entrepreneurs. The two

found time to tell us about their start-up success.

We are the cofounders. We were working together in corporate

finance and we started noticing that all of our colleagues were getting

their suits and shirts made overseas. Around that time

e-commerce was really starting to take off in Australia and we sort of

thought it was a really good opportunity to bridge that gap. It

was a really low start cost opportunity for us and scalable, so

we thought we had definitely identified a gap in the market for

premium made-to-measure clothing, without the designer markup. I

couldn't read or write Chinese and that was always a personal goal for

me, to learn that. I went to a university in Beijing, one of the

top two universities in China. I am Chinese, what I was basically

illiterate. I'd also I just felt like with the way that China is

developing, we would always need those skills in any business that we

ended up doing. It wasn't always a smooth start. When we first went

over to China, we thought we had all of this language skills that we

wanted to use and we were out there trying to find a supplier and no one

wanted to talk to us because we have this business model where every

garment is made individually and Chinese suppliers are really more

used to working on huge volumes for huge US retailers. But then we

decided to go to Hong Kong, where the factories are actually smaller

and they aren't producing on such large scale. Being Asian, the way we

were brought up was you've got to study hard you can grow up and get a

good job. But in my parents' eyes, a good job was always you have to be a

doctor, lawyer, an accountant. It took a while for us to fix things

here and there, change things, change it from a custom-designed to

a custom fit, but we now do more in a week in revenue than we did in the

first six months of trading. Very nice! Custom-made clothing. And

before we go, a quick look at the markets. As you can see right now

it's a mixed bag for the regional markets in business after US

equities finished mixed, as energy companies fell, with the price of

oil. Investors digestive minutes from Fed policymakers. That might

see an interest rate hike before the end of the year and this is boosting

the US dollar against major currencies, especially the Japanese

yen. That's why exporters are leading the way for the Nikkei to do

five, up by 107 points. Those are the markets. Thanks so

much for investing your time with us. Sport Today is coming up next.

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