Pantheon Publications
Below is a list of our Publications for the last 5 months. If you are looking for reports older than 6 months please email info@pantheonmacro.com, or contact your account rep.
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Duncan Wrigley
China’s Q1 GDP growth was boosted by demand stimulus and export front-loading pre-tariff turmoil
- China’s Q1 growth was already cooling from the Q4 high; hence March’s additional fiscal stimulus.
- Front-loading effects also boosted March exports and industrial output, but this should prove fleeting.
- China will need to stoke domestic demand further, as exports risk hitting a wall in the coming quarters.
- The March CKGSB index reports reviving Chinese business confidence, despite the imminent trade war.
- Funding conditions have improved thanks to policy support, though profits are under pressure.
- Robust government-bond issuance lifted broad credit growth in March; M1’s rise is somewhat encouraging.
Government bond issuance still taking centre stage, with modest uptick in household loans
- China acted as the adult in the room on Friday, saying it will not match any further US tariff hikes.
- This is hopefully the escalation off-ramp, paving the way for bilateral talks, probably in several months.
- Still, tariffs will likely remain high, hurting exports, worsening excess supply and so prolonging deflation.
- Both the US and China seem to have dug in, making a short-term cessation of trade-war hostilities unlikely.
- More escalation is likely on the cards, but this could be the crisis that prompts China to boost consumption.
- The PBoC has started allowing RMB depreciation as part of the response, but it must tread carefully.
- Both China and the US are posturing as the trade war escalates and markets plunge.
- China’s National Team appears to be intervening, with limited success, to soften the A-share market dive.
- The PBoC is likely to cut the RRR soon to boost confidence; government-bond issuance will speed up
China's foreign reserves excluding valuation effects fell
Japan's real wage decline hurts consumption
- China’s all-out response on Friday to US tariff hikes is likely intended to get US-China talks going soon.
- We have cut our 2025 Japan GDP forecast by 0.2pp to 0.8%, due to the US tariff hikes announced last week.
- The BoJ is even more likely to hold fast on May 1, waiting for clarity, as Japan presses for lower tariffs.
China likely to step up fiscal and monetary policy support, allow weaker RMB, in response to hefty US tariff hike;
Caixin services activity rises
- China will seek to prop up domestic demand in response to the US tariff hikes…
- …But this won’t mitigate the hit to growth fully, so we cut our 2025 GDP growth forecast by 0.4pp, to 4.0%.
- Serious trade talks are likely to get underway soon, but the US is unlikely to roll back the tariff hikes fully.
- Korean export growth accelerated in March, but due to post-holiday effects and front-loading or orders.
- The manufacturing PMI slipped in March, despite a robust new export order reading.
- Firms are worried about tariff hikes and political risks, with the impeachment ruling due on Friday.
- China’s official March PMIs showed lasting, though waning, stimulus support for activity.
- The manufacturing index is still above 50, but sentiment slipped ahead of likely US tariff hikes today.
- Construction new orders dived, raising questions about local-government investment activity.
