11 Apr 2022 Omicron Should Weigh Heavily on Chinese Q1 GDP, in Theory

We are downgrading our outlook for Chinese growth, as zero-Covid policies continue to tighten. 

Data quality is more questionable than ever, though February was softer than it looked. 

Policy support will eventually arrive, but little of substance has materialised, so far. 

Craig BothamChina+

16 Feb 2022 Japan Returns to Growth, but the Bumpy Ride isn't Over

• Japanese GDP growth returned to positive territory in Q4, thanks to a rebound in consumption.
• Consumption will be under pressure in Q1, thanks to Omicron, but investment should recover.
• Chinese stimulus remains very modest, illustrated by a net withdrawal of liquidity this month.

Craig BothamChina+

19 Jan 2022 Inflation Risks on the Rise in Japan, but Not Enough to Change Policy

• The biggest change from the latest BoJ meeting was a reappraisal of the inflation outlook.
• Risks to inflation are now seen as balanced, rather than to the downside, the first change since 2014.
• Still, there will be no change in key policy settings for the next two years, with the target not in sight.

Craig BothamChina+

13 Jan 2022 Chinese Inflation is Past the Peak, and Set to Plunge

• China's CPI inflation surge was short-lived, and is set to be followed by a sharp reversal, soon.
• Producer prices are also rolling over rapidly, relieving inflation pressure at home and abroad.
• Omicron is now spreading in China, which will hit activity and inflation, but disrupt supply chains.

Craig BothamChina+

10 Jan 2022 Energy Leads Japanese Inflation Higher in December

• Tokyo CPI inflation reached a two-year high in December, thanks largely to energy prices.
• Inflation will climb further yet, but will still fall short of the BoJ's 2% target.
• Chinese reserves data show the PBoC has been leaning against renminbi appreciation.

Craig BothamChina+

10 Dec 2021 China Finds Seasonal Cheer in November Inflation

• Chinese consumer price inflation accelerated in November, driven by food prices...
• ...but base effects will soon weigh on the index, such that November marks the near-term peak.
• Producer price inflation has already begun to rollover, as energy prices start to fall.

Craig BothamChina+

16 Nov 2021 Chinese Industry Avoids Calamity, but Q4 Looks Set for Weakness

• China's October activity data were better than ex- pected, but chiefly reflecting a low bar.
• Industrial production growth staved off collapse, but is still near multi-decade lows.
• The property sector is a chronic, and building, headwind for the economy.

Craig BothamChina+

1 Nov 2021 Japan Continues to Go its Own Way on Inflation

• Japanese inflation remains anaemic, no matter which way you slice it...
• ...as a result, Japan looks increasingly isolated among developed market economies.
• Monetary policy divergence will become more pronounced, with consequences for the currency.

Craig BothamChina+

19 Oct 2021 China's Policymakers Unmoved, Despite a Sharper Slowdown

• Growth slowed in September, as energy shortages and property market weakness hit the economy.
• Industrial production, investment and GDP all reflected elements of the twin crises.
• Policymakers remain sanguine, even so, and still have some wriggle-room on their growth target.

Craig BothamChina+

18 Oct 2021 China's Cost Shock Creates Problems Everywhere

• Surging factory gate prices have just begun to re- flect recent energy shocks.
• The Chinese consumer may be shielded from the energy hit, but China's economy will still suffer.
• Global spillovers seem likely, with further cost in- creases to come as winter looms.

Craig BothamChina+