China Economics Update People's Bank signals intent to "normalise" policy The Q3 monetary policy report published earlier this week is the first formal policy statement from the People’s Bank (PBC) since interest rates were hiked a fortnight ago. In it, the PBC mentions a... 4th November 2010 · 1 min read
China Data Response PMIs (Oct.) China’s latest PMIs suggest that the economic rebound has further to go. Input prices have picked up, but manufacturers are not passing price increases on to consumers. As a result, the People’s Bank... 1st November 2010 · 1 min read
China Activity Monitor Construction supporting economic rebound The Capital Economics China Activity Proxy (CAP) confirms the recent acceleration in quarterly growth that emboldened policymakers to hike interest rates last week. But it also shows that the... 28th October 2010 · 1 min read
China Chart Pack Renminbi gains likely to fade (Oct 10) The renminbi has risen more than 2% against the dollar since the beginning of September. The US Treasury’s decision to defer publication of its currency report and the upcoming G20 summit will... 27th October 2010 · 1 min read
China Economics Update Is China changing course? The People’s Bank (PBC) delivered a jolt to global markets when it unexpectedly raised interest rates last week. Never mind that the small increase will have a negligible impact on China’s economy... 25th October 2010 · 1 min read
China Economics Update Growth stabilises, inflation still not a threat Today's data did not show the upsurge in inflation that some had thought might have triggered this week's interest rate hikes. Q3 GDP growth too was in line with initial expectations. Instead, the... 21st October 2010 · 1 min read
China Economics Update What is behind China's rate hike? With its surprise decision to raise benchmark interest rates, the People’s Bank of China is giving a strong signal to banks to rein in lending after the surge of the last few weeks. The immediate... 19th October 2010 · 1 min read
China Economics Update Rapid renminbi rise will not be sustained China is again responding to foreign pressure with a surge in the renminbi. But a coming slowdown in exports, a desire to limit the predictability of the renminbi’s rise and, possibly, a rebound of... 18th October 2010 · 1 min read
China Data Response NBS business conditions survey (Q3) Confidence among Chinese firms recovered in Q3 as worries about the outlook for the real estate sector faded. 14th October 2010 · 1 min read
China Economics Update Surge in FX reserves throws spotlight on Chinese intervention The $194bn increase in China’s foreign exchange reserves in the third quarter was one of the biggest on record. There are two immediate implications. 13th October 2010 · 1 min read
China Data Response Sustained surpluses and massive FX intervention China's overall trade surplus may have declined slightly last month, but tensions are unlikely to do the same. Q3's monthly surpluses with the US were the three largest on record. Meanwhile, the value... 13th October 2010 · 1 min read
China Economics Update Looking ahead to the Five-Year Plan The most closely-watched data release this month will be that for third quarter GDP, due on the 21st. But a more momentous event will take place a few days earlier when the Communist Party leadership... 11th October 2010 · 1 min read
China Economics Update What should we make of the rumoured RRR hike? Reuters is reporting that the required reserve ratio (RRR) for major banks has been raised. The People’s Bank (PBC) has not confirmed the move, but if true the best explanation is that the large banks... 11th October 2010 · 1 min read
Japan Economics Weekly Is China to blame for the strong yen? China may have bought an unusually large quantity of Japanese bonds over the summer, but its purchases were too small to explain the strength of the yen or falls in government bond yields. In any case... 11th October 2010 · 1 min read
China Economics Update Can exporters survive a stronger renminbi? Export margins did not fall when the renminbi was last rising against the dollar and Chinese producers continued to gain global market share. There is no reason to think that China’s export sector is... 7th October 2010 · 1 min read
China Economics Update Inflation Monitor (Sep.) Consumer price inflation is probably close to a peak. If the People’s Bank does not raise interest rates in the next few weeks (we think it won’t), it will find it increasingly hard to justify doing... 5th October 2010 · 1 min read
