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This report is only available as a PDF. Click to download. … How will Asian central banks respond to the financial crisis? …
6th October 2008
The Bank of Japan’s Tankan survey of business conditions was disappointing but not disastrous. The detail contained some reassuring news with regard to financial conditions and the labour market. … Tankan shows Japan's economy slowing, not …
1st October 2008
This report is only available as a PDF. Click to download. … Fiscal reforms on the back burner in Japan …
29th September 2008
We believe that the Bank of Japan’s quarterly “Tankan” survey for September, due next Wednesday, will show that business conditions have held up rather better than the consensus expects. Indeed, the MoF/Cabinet Office Business Outlook Survey, published …
24th September 2008
This report is only available as a PDF. Click to download. … How are Asian policymakers responding to the financial crisis? …
22nd September 2008
Chinese share valuations are now at their lowest in more than a decade. Yet government attempts today to give them a boost through a tax cut and direct share purchases may be more harmful than helpful in the long run. … China tries to stem the equity …
18th September 2008
Today’s unexpected rate cut in China is intended as a sign that the government is willing to act preemptively to guarantee continued strong economic growth. But there will also be suspicions that the government has been rattled into boosting share prices, …
15th September 2008
This report is only available as a PDF. Click to download. … The end of fuel subsidies in China …
Markets appear to have all but given up on the idea that the renminbi will appreciate against the dollar over the next year. But we find nothing in the data on China’s real economy or in the outlook for the dollar to justify this view. We think that the …
11th September 2008
Today’s decision by the Bank of Korea (BoK) to keep interest rates at 5.25% (after last month’s 25 basis points hike) was accompanied by a relatively hawkish policy statement. But we still expect the next rate move to be down, and that it will happen …
Today’s trade and inflation data from China open the door to a series of policy adjustments, including to fuel pricing, but an end to currency appreciation is unlikely to be among them. … Policy rethink ahead in China as inflation …
10th September 2008
This report is only available as a PDF. Click to download. … Next move in Korean rates still likely to be down …
8th September 2008
The recent pullback in oil prices – and commodity prices more generally – has encouraged most Asian central banks (ex. China & Japan) to reorient their policy priorities back towards supporting growth. Indeed, the latest CPI data suggest that inflation …
4th September 2008
Today’s 25bp rate cut to 7.0% confirms the Reserve Bank of Australia’s (RBA’s) shift in focus from inflation towards growth concerns. The RBA had previously been one of the most hawkish central banks – continuing to raise rates even when the US Fed was …
2nd September 2008
This report is only available as a PDF. Click to download. … How bad will it get for Australian consumers? …
1st September 2008
With today’s rate hike, we think that the Bank of Thailand has probably done enough to keep inflation in check. Rates are likely to be left on hold into 2009, but attention will gradually turn to supporting growth. In contrast, with Bank Negara Malaysia …
27th August 2008
This report is only available as a PDF. Click to download. … Short-term fixes spell trouble ahead for Thailand …
25th August 2008
Market speculation that China’s government is lining up a big fiscal package is likely to prove unfounded. With the economy still in good shape, there is no immediate need for a stimulus. Nonetheless, fiscal policy does have an important role to play over …
21st August 2008
We expect inflation of 4% or below in China next year, but mounting core pressures mean that Russia is likely to suffer double-digit inflation for the rest of this decade. But the policy response may not differ dramatically. … Will the BRICs win the …
20th August 2008
The recent fall in the prices of oil and other commodities strengthens our view that the present tightening cycle in South-East Asia will be a short one. We expect regional interest rates to peak in the next few months, before falling back in 2009. … …
19th August 2008
The Bank of Japan predictably left rates on hold today. But with inflation expectations surging to record highs, and the current economic downturn expected to be relatively short-lived and shallow, we still think that the next move in rates is up and that …
With consumer spending outpacing expectations, China will this year contribute twice as much to growth in real global consumption as the US, euro-zone and Japan combined. (See Chart 1.) This should guarantee another year of healthy growth for China as a …
18th August 2008
This report is only available as a PDF. Click to download. … What explains the strength of Chinese exports? …
Japan has been hit hard by surging food and energy prices, but has avoided the credit crunch and collapsing house prices that have undermined so many economies in the West. Indeed, the Japanese economy is still in relatively good shape compared to similar …
14th August 2008
This report is only available as a PDF. Click to download. … Can fiscal policy do anything to boost growth in Japan? …
11th August 2008
For many, China enters a new era with the hosting of the Olympics. There is a growing sense that China is also going through an economic transition: a poor run of data has sparked questions over whether China’s days of double digit growth are behind it. …
8th August 2008
We suspect that today’s 25bp rate hike from the Bank of Korea (BoK) will be a one-off move similar to the European Central Bank’s warning shot last month, rather than the first in a new tightening cycle. … First Korean rate hike in 12 months also likely …
7th August 2008
The first estimate of Japan’s second quarter GDP will be released, not very auspiciously, on the 13th (next Wednesday). We expect this to show an outright fall of around 0.3% q/q, although a much bigger decline would not be a huge surprise after the …
6th August 2008
Officials at the People’s Bank of China should be feeling pretty pleased with themselves. Market expectations for future renminbi appreciation have tumbled following a month of slower currency gains and acknowledgement from the leadership that inflation …
5th August 2008
This report is only available as a PDF. Click to download. … Is Japan heading for recession? …
4th August 2008
Today’s sub-50 reading for China’s official PMI implies that the manufacturing sector is in outright decline. Some are suggesting this might be enough for policymakers to reconsider their stance on currency appreciation. But today’s reading probably …
1st August 2008
This report is only available as a PDF. Click to download. … Japan’s manufacturing recession to be short and shallow …
30th July 2008
By taking tougher than expected action, today’s rate hikes provide welcome reassurance that the Reserve Bank of India (RBI) is serious about tackling rising prices and will help keep inflation expectations well-anchored. The RBI lifted the repo rate by …
29th July 2008
Contrary to speculation by some commentators, Beijing’s slight change of emphasis on the economy over the weekend is more likely to show up in fiscal policy and administrative support for exporters than any shift on interest rates or currency policy. … …
28th July 2008
This report is only available as a PDF. Click to download. … Indian rate hikes may not be enough to restore credibility …
Today’s narrow confidence vote win, by 275 to 256 votes, gives a much needed boost of political capital to India’s beleaguered Indian National Congress (INC) party. We are cautiously optimistic that the development will spell a change in economic policy. …
22nd July 2008
The recovery in the construction sector should prevent an outright fall in Japanese GDP in the second quarter and contribute around 0.7 percentage points to growth in the year as whole. The economy is therefore likely to grow only a little more slowly in …
This report is only available as a PDF. Click to download. … What could go wrong in China? …
21st July 2008
Today’s confirmation that both GDP growth and consumer price inflation have continued to slide in China raises the chance that officials will shift their policy concern to supporting economic activity and jobs. We expect some administrative measures such …
17th July 2008
The decision by the Philippines’ central bank to raise the benchmark interest rate by a larger-thanexpected 50bp to 5.75% should not be taken as a signal that other Asian central banks are about to embark on a more aggressive tightening path than …
Thailand’s decision to raise interest rates today (by 25bps to 3.5%) was the first in more than two years. However, growing downside risks to growth, despite the recently announced fiscal stimulus, suggest that this tightening cycle will be short in …
16th July 2008
This report is only available as a PDF. Click to download. … Thai rates next to rise as inflation soars …
14th July 2008
The slowdown in India’s industrial sector growth to 3.8% y/y in May (from a revised 6.2% y/y in April) was worse than even we had expected. Recent monetary tightening suggests that the outlook for the industrial sector is about to get even worse. …
11th July 2008
The Bank of Korea (BoK) held official rates at 5.00% today, as widely expected. The accompanying statement highlighted the growing dilemma facing the BoK. But successful interventions to prop up the won in recent weeks have supported our view that the …
10th July 2008
The Reserve Bank of India can be forgiven for having initially taken a less hawkish stance towards inflation. GDP growth was thought to be slowing more quickly than revised data indicate. And few had predicted that oil would top $140 per barrel, putting …
9th July 2008
This report is only available as a PDF. Click to download. … Japanese growth to surprise on the upside again …
7th July 2008
The Japanese economy is clearly slowing. Indeed, the official data suggest that consumer spending has fallen sharply and manufacturing may already be in a (short-lived) technical recession. Nonetheless, the flying start to the year means that GDP is still …
3rd July 2008
We think that Australian interest rates will be cut by the end of this year and eventually fall to 6% (from 7.25%) by the end of 2009. In contrast, the markets are currently pricing in a 75% chance that the Reserve Bank of Australia (RBA) will raise rates …
2nd July 2008
June’s Tankan survey confirms that Japanese business conditions are deteriorating, but not as far as most had feared. The economy is in much better shape than at similar stages in previous downturns. … Tankan shows Japan’s economy slowing, not …
1st July 2008
This report is only available as a PDF. Click to download. … Chinese equity markets shrug off corporate strength …
30th June 2008
