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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

Please use the filters on the right to search for a specific date or topic.

monetary policy

16 May 2022 A Change of Tune from the PBoC Amidst a Slump in Lending

The PBoC has adopted new language in the wake of a slowdown in bank lending...

...But we think this is unlikely to signal a sudden pivot in monetary policy, given other constraints.

The PBoC has no choice but to accept a higher debt ratio, unless it wants to deepen the recession.

Craig BothamChina+

12 May 2022 Food is Driving Up Chinese Inflation, but the Core Rate is Falling

Chinese CPI inflation jumped in April, due to soaring food prices, but that will not worry the PBoC.

Zero-Covid has pushed up food prices, even as it depresses core inflation.

The PBoC has joined fiscal policymakers in making announcements with no new information.

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+

6 May 2022 China's Labour Market is Under Increasing Pressure

The Caixin Services PMI plummeted again in April, as the zero-Covid vice tightened further.

The employment picture is darkening rapidly, and will be a major worry for policymakers.

We are still waiting for a material shift in policy, even so; announcements so far contain nothing new.

Craig BothamChina+

29 Apr 2022 The BoJ Fiddles While the Yen Burns, the MoF Readies the Hose

The BoJ shrugged off currency fears, keeping rates on hold and even leaning into YCC.

Acting as a sign of determination to keep rates capped, markets duly reacted by dumping the yen.

Japan’s Ministry of Finance reacted swiftly, and irritably; intervention now looms on the horizon.

Craig BothamChina+

25 Apr 2022 The BoJ will Remain Indifferent as Inflation Approaches Its Target

Japanese inflation is still rising, and is all but guaranteed to break through its target in April...

...But the BoJ has already indicated it has no intention of changing tack; rates won't rise this year.

Policymakers are flirting with the idea of currency intervention, but Kuroda won't take the lead.

Craig BothamChina+

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+

19 Apr 2022 Caught on the Horns of a Dilemma, with Chinese Characteristics

China's economy beat expectations in Q1, but is still falling short of the 2022 growth target.

The GDP data probably overstate economic growth, but either way things will get worse in Q2.

The battle with Covid is proving extremely costly; it will necessitate more stimulus, and soon.

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+

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+

8 Apr 2022 China's FX Reserves Data Herald An Inflection Point for the Renminbi

China's FX reserves fell again in March, amidst reports of large portfolio outflows, thanks to Putin.

One by one, the key supports for the renminbi are being chipped away, and Q2 will be turbulent...

...but H2 will see a downward trend consolidate, as multiple headwinds force the RMB to submit.

Craig BothamChina+

6 Apr 2022 PMIs Show Domestic and External Demand are Diverging for Japan

Japan's services PMI rebounded in March, adding to evidence of a domestic recovery in late Q1.

Unfortunately, 2022 has had a slow start, and GDP probably fell in Q1, quarter-on-quarter.

Inflation still isn't behaving as the BoJ would like, but the sands are shifting on the yen.

Craig BothamChina+

1 Apr 2022 A Sharp Slowdown for China in March, but No New Stimulus, Yet

  • China's economy is groaning under the strain of increasingly restrictive zero-Covid policies.
  • Factory closures and lockdowns took a heavy toll on both manufacturing and services in March.
  • Policymakers are relying on the existing toolkit, deployed more rapidly, for now.

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+

25 Mar 2022 Japanese PMIs Add to Evidence of a Slowdown in Global Trade

  • We think Japan's flash manufacturing PMI was mostly bad news, despite a bounce in the headline.
  • Forward-looking components turned south, and we expect the final print, and next month's, to be softer.
  • A drop in new export orders is another signal that global trade is struggling amid renewed shocks.

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+

21 Mar 2022 The BoJ Splits from the Pack, as Energy Costs Climb

  • Japan is not entirely immune to global inflation shocks; CPI is rising as energy costs surge.
  • The BoJ, however, has the luxury of choosing the sort of inflation it wants, and will not be hiking.
  • Don't get too excited by rumours of a turnaround in Chinese policy; nothing much has changed.

Craig BothamChina+

17 Mar 2022 Japanese Export Momentum Wanes, as Global Problems Mount

  • Japanese exports bounced back in February, as holiday effects reversed, but should fade from here.
  • Challenges are growing for both demand and supply, with no clear resolution in sight for either.
  • China's property market shows no sign of recovery, and policymakers are getting nervous.

Craig BothamChina+

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