JULYASIA BUSINESS OUTLOOK8HSBC PREDICTS STRONG QUARTER IN VIETNAMSIX EUROPEAN AGENCIES TO INVEST KRW 1.2T IN SOUTH KOREAN PROJECTSFollowing three consecutive 50 basis point reduction to the policy rate by the State Bank of Vietnam (SBV) in the previous three months, HSBC forecasts a major economic recovery in Vietnam beginning in the fourth quarter (Q4) of 2023.HSBC emphasised the SBV's necessity to boost growth through the loan channel. According to a paper headlined 'The State Bank of Vietnam: Third Time's a Charm,' the rate cuts are expected to continue lowering financing costs for enterprises and consumers, thereby increasing economic investment and bolstering consumer optimism.Moreover, the SBV is predicted to effectuate one more 50 base point cut in the easing cycle in Q3 2023, to further support growth. This possible move could bring the policy rate to 4.0 per cent, mirroring the rate cuts during the pandemic and counteracting the tightening measures of 2022.The bank's recent actions underscore its ongoing optimism regarding inflation, which the report maintains is `under control'. The SBV's optimism is substantiated by a cooling inflation rate, recently dipping below 3 per cent YoY, considerably under the 4.5 per cent ceiling. This trend has allowed HSBC to revise its 2023 inflation forecast down to 2.6 per cent from 4.0 per cent. Six European businesses will spend 1.2 trillion won ($929.27 million) in South Korean projects ranging from batteries to renewable energy, the country's industry ministry announced on Wednesday.The news came during South Korean President Yoon Suk Yeol's visit to France this week.Imerys, Umicore, Continental, Nylacast, Copenhagen Infrastructure Partners (CIP), and Equinor will invest in industries like as batteries, automotive materials, and offshore wind power, according to the ministry.CIP announced plans to spend $350 million in gigawatt-scale offshore wind projects to assist South Korea's ambitious wind generation target.Equinor stated that the investment is a reinforcement of its interests in Korea, where its 'Firefly' renewables project, located offshore the city of Ulsan, will have a capacity of around 800 megawatts when completed around 2028, though a final investment decision has yet to be made.Other companies did not reply promptly to a request for comment.There was no information on how much each corporation planned to invest or whether any projects had already been publicised.Yoon is scheduled to visit Vietnam for three days later this week. NEWSROOM
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