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China+ Publications

Below is a list of our China+ Publications for the last 6 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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27 June 2022 Yen Weakness will Keep Inflation Above Target; the BoJ Won't Care

Japanese CPI inflation was unchanged in May, andremains above the 2% target.

We think inflation will remain above target for the rest of the year, thanks to recent yen weakness.

But the BoJ will still see no reason to hike, with cost-push inflation viewed as “unsustainable”.

Craig BothamChina+

30 May 2022 The Excitement is Over for Japanese Inflation, and the BoJ

Inflation is stabilising in Japan, after its April surge, and we do not expect much movement from here.

Yen weakness has partially reversed, thanks to U.S. data, easing the pressure on the BoJ.

Chinese industry is under pressure, particularly the private sector, and policy offers only limited support.

Craig BothamChina+

23 May 2022 Back Above Target At Last, but the BoJ Won't Change Tack

Japan’s CPI inflation is finally back above its 2% target, but this won’t prompt a change from the BoJ.

The surge has been driven almost entirely by base effects, rather than any pick-up in demand.

Falling rates in China, aimed at propping up the property sector, will have little effect.

Craig BothamChina+

9 May 2022 Above Target At Last, but the BoJ Still Won't be Satisfied

Japan’s Tokyo CPI broke through its 2% target, as widely expected, but policy won’t change.

Inflation driven by base effects, and food prices, is seen as unsustainable by the BoJ.

Imported inflation will be viewed in a similar light, so no change in the policy rate is on the horizon.

Craig BothamChina+

14 Apr 2022 Zero-Covid Weighs on Trade, and Obliterates Domestic Demand

China's trade surplus enjoyed a final lift in March, as import demand collapsed, and exports rose...

...But look through the seasonal distortions, and exports were weaker than they appeared.

Beijing has promised to offset some of the pain from zero-Covid, but stimulus looks light, to us.

Craig BothamChina+

12 Apr 2022 Plenty of Scope, and Need, for Further Easing in China

China's inflation outlook remains very different to most major economies, despite the energy shock.

The PBoC is able to ease further, with inflation far from its target, but is proving reluctant.

Private sector demand for credit still looks soft, and the PBoC’s power is limited, absent fiscal action.

Craig BothamChina+

28 Mar 2022 More of the Wrong Sort of Inflation for the BoJ, as the Yen Plummets

  • Energy and food push inflation higher, and Japan is set to beat its target next month...
  • ...but the BoJ won't be moved, as demand-pull inflation remains as elusive as ever.
  • Yen weakness is the biggest challenge to the BoJ's position, and likely will force a shift by H2.

Craig BothamChina+

17 Feb 2022 Pigs Might Fly, but they Bring Lower Inflation in their Wake

  • Chinese inflation continued its decline in January, thanks to base effects and weak demand.
  • The main constraint on PBoC action is worries over financial stability, not inflation.
  • China should export disinflation in 2022, a soothing balm for policymakers outside China.

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+

28 Jan 2022 A Bumper Period for Chinese Industrial Profits is Ending

  • Chinese industrial profit growth slowed further in December, though 2021 was stellar overall.
  • The pandemic has lifted profits far above trend, but the bounty is now over, as headwinds build.
  • Elevated costs, limited pricing power, tighter Fed policy, and increased competition, will hit profits.

Craig BothamChina+

21 Jan 2022 Trade Regathers Momentum, but Bottlenecks are Building Again Too

  • Japanese December export data are better than they look, along with the rest of the region.
  • External demand still looks robust, despite Omicron, but supply challenges loom large.
  • Omicron is in fact more worrying from a supply perspective, given its implications for China.

Craig BothamChina+

17 Jan 2022 Weaker Imports Suggest a Weaker Domestic Economy in China

  • China posted a new record-high trade surplus in December, boosting the renminbi.
  • Behind the headline, however, lurks a troubling weakness of imports and domestic demand.
  • Korea's central bank hiked rates to 1.25%, and signalled more to come this year.

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+

20 Dec 2021 The BoJ Takes Another Step Back, but Don't Call it Hawkish

  • The BoJ kept its main policy tools unchanged in December, but tinkered around the edges.
  • An announced reduction in corporate debt purchases had already begun in practice.
  • The taper is offset by an extension of SME lending, which has been a bigger balance sheet driver.

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+

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