22 Apr 2022 The PBoC Buckles Up for the Renminbi's Wild Ride

China's currency is finally succumbing to pressure from multiple fronts, and has further to fall.

The renminbi poses a key constraint to PBoC policy, which Beijing will ultimately override.

April export data from Korea show that China's bat- tle with Covid will weigh heavily on global trade.

Craig BothamChina+

21 Apr 2022 China Drags on Exports, Adding to Japan's Problems as the Yen Drops

Lockdowns and shuttered factories in China appear to be the culprit behind slowing Japanese exports.

Further weakness seems inevitable as Chinese policy tightens, and regional supply chains collapse.

Underperforming exports again raise questions about the benefits of a weaker yen.

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+

22 Mar 2022 Korean Exports Falter as Demand and Supply Issues Bite

• Preliminary trade data from Korea point to a loss of momentum for global trade in March.
• War and Covid have tightened some bottlenecks, but demand is also under pressure from oil prices.
• The PBoC again opted not to ramp up monetary easing, despite recent messaging from Beijing.

Craig BothamChina+

14 Feb 2022 It's Clichéd, But Sometimes a Crisis Really is an Opportunity

• China saw another huge current account surplus in Q4, but it is under increasing pressure.
• The support provided to China's external balance by the pandemic will fade further in 2022.
• The renminbi should weaken on a sustained basis in H2, though pressure could show as soon as Q2.

Craig BothamChina+

11 Feb 2022 The State Sector Doubles Down as Risk Appetite Dwindles

• Record weakness in Chinese M1 growth is only partly attributable to seasonal and base effects...
• ...Weaker risk appetite, and softer economic activity, underlie the drop in liquid deposits.
• Credit growth continued to become more heavily dominated by the state in January.

Craig BothamChina+

27 Jan 2022 Chinese Property Sector Update, Keep a Cool Head on Easing

• China's property sector plummeted over the course of 2021, and nosedives are hard to escape.
• Policy easing looks modest compared to previous cycles, in line with government messaging.
• The impact of easing on growth will also be weaker than markets expect, based on past cycles.

Craig BothamChina+

CHINA+ DATA WRAP 20.01.22 - Japanese exports slow and Chinese rates fall

External demand began to perk up in late Q4, if you look through the base effects

Bank lending rates follow the MLF down

Craig BothamChina+

CHINA+ DATA WRAP 20.12.21 - Chinese monetary policy decouples further from the rest

A further tilt towards easing

Craig BothamChina+

16 Dec 2021 Infrastructure is Still En Route, but Other Headwinds are Forming

Craig BothamChina+

13 Dec 2021 Slow and Steady in November as Policymakers Double Down

• Early Chinese data point to a stabilisation—at low levels— of economic activity.
• Infrastructure investment likely rose in November, partially offsetting the property slowdown.
• Prepare for a harsher crackdown on the private sec- tor in 2022, and more infrastructure spending.

Craig BothamChina+

CHINA+ DATA WRAP 22.11.21 Hope for growth from the PBoC and Korean exports

Preliminary Korean data gives reason for hope on trade, despite the slowdown

PBOC stands pat, but easing is on the way - just not for the property sector

Craig BothamChina+

17 Nov 2021 Japan's Recovery Can't Afford Policy Mistakes

• Japanese growth fell sharply in Q3, as both consumption and capex declined.
• A near-term rebound is on the cards, as temporary headwinds fade.
• Beyond Q4, however, growth needs policy support merely to return to, let alone surpass, its trend.

Craig BothamChina+