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Talking China In this week’s Economic Letter from Asia, we focus on China, which has shown early signs of recovery following recent easing measures. While many view China’s latest local government debt swap program as a positive step, some remain underwhelmed by its scale, which falls short of estimates for the total amount of local government "hidden debt." We also examine broader structural issues that are likely to remain points of contention between China and other major economies, including China’s persistent current account surplus and concerns about its overcapacity. View the full commentary with charts here: https://lnkd.in/eDq_PnpX

📣 Uncertainty Is the Easy Part The policy decisions of a new US administration could potentially impact the global economy in a number of ways with key areas that might be affected including trade and tariffs, geopolitical stability, fiscal policy, deregulation, and immigration policy. In our charts this week we focus on: ⚡️Global equity market responses ⚡️Economic policy uncertainty ⚡️The consensus for policy rates ⚡️Oil prices and yields ⚡️China’s economy ⚡️Japan’s politics Access the full commentary and charts here: https://lnkd.in/gHZcwp_b

An overview of the recent stimulus measures in the Chinese property market for those interested. What are the key policy features? What is the macroeconomic context behind this wave of support? Are there any potential challenges in implementing these policies? And, most importantly, what can we anticipate in the near term? #China #Property

As global markets respond to the latest political developments and economic shifts, our latest article breaks down the impact of the 2024 US Presidential Election on the DXY Index, China’s economic outlook, and how APAC markets are responding. Read the full article here: https://bit.ly/48jTQCK #FXPolling #FXMarkets #GlobalFinance

While it is certainly the right topic to be exploring, the angles of analysis need to be broadened to glean better insight, and use of Plaza Accord as an analogue is a significant miss. Firstly, Trump's invitation was purely signal, with no expectation for Xi to attend. It should not be analysed on traditional comparisons, as everything about a Trump presidency is breaking with historical norms. Its real objective is to set an early summit date to usher in the new era. Bessent's comments are most relevant, as a financial architecture amendment to match the global economic reordering that has already occurred would be helpful. However, it is not a Plaza Accord redux, as China's economic and geopolitical position are completely different. In 1985, Japan's economy was strong on all components, and the first significant rise in household wealth was driving both traded goods & asset price inflation. It was in a position to absorb a deflationary shock from currency realignment. Furthermore, Japan was under the US security umbrella and Washington was keen to invite Japan into the G7 inner circle. Reagan-Nakasone relationship, like that of Reagan-Thatcher, was a bridge of trust that facilitated grand strategy shifts. China, on the other hand, is not part of the US-Europe-Japan leadership dynamic. Trump could invite China to join an expanded G8, as Clinton did in the 90s with a post-Soviet Russia, but China, like Russia then, would never feel part of the team. There is no basis of trust there. The demands for currency appreciation will also not happen while China is battling deflation and capital flight. At best, Xi could pledge to hold the RMB steady, as it did during the Asian Financial Crisis. Holding the Yuan steady is what the PBOC is doing now. If not for the artificial fixes, USDCNY would be much higher. China doesn't need a weaker currency for export competitiveness, as it is willing to sacrifice profit margins for export volumes, and keeping a steady Yuan matches the confidence narrative it tries to promote, making stability an easy pledge to offer. But it would seem Bessent is hinting at something grander. If one works from the basic Trump premise, which is a lack of faith/trust in international institutions, the grand arrangement could target greater burden sharing, and by implication - a greater leadership role for China in these organisation. The IMF, World Bank, ADB, even BIS & FSB could also be open to expanded China leadership. Trump would view this loss of US leadership control an area he's happy to concede, much like the reduced US NATO commitment, where the burden no longer seems to match the benefits accruing to the US. What would the US want in exchange? More than likely the US would seek China enforcement of western sanctions against Russia. Driving a wedge between China and Russia will be a pillar of the Trump Admin's strategy to end the Russia-Ukraine war. #trump #xi #uschinarelations #geopolitics

It is my personal view not my employer’s house view. This is a result of divergence of monetary policy stance between the Fed and the PBoC. Then renminbi go weak and US will criticize China as “currency manipulator”. In terms of fiscal policy space, in addition to using traditional tools-growing amounts of issuance for government bond, it will be better to manage tax reduction to promote consumer spending. Japanese government rose consumption tax twice in six years while country are suffering from long-term stagnation- it is a only mistake of late prime minister Shinzo Abe. #Markets #Investing #China #Japan #AssetAllocation #LinkedInNews #LinkedInInsights

The U.S. is a major player in international #trade, investment flows, and economic trends because it is the anchor of the global #economy. So, the 2024 presidential election is not just a national but also a worldwide event with profound effects on #trade dynamics, the #supplychain, economic stability, and more. Read Oğuzhan Günalay's latest article:

International Monetary Fund deputy managing director Gita Gopinath warned on Wednesday that a rise in trade and tariff tensions between the United States and China will have "costly" economic repercussions globally. "When you look at overall trade to GDP, that's holding up fine, but who's trading with whom is definitely changing," she added, referring to the geopolitically driven commerce that is taking place globally. Follow for more such content. Stay informed on the latest business news by visiting our website - https://buff.ly/3w3pENB #globalbusinessandfinancemagazine #businessnews #news #internationalnews #business #globalbusiness #globenews #newsupdates #todaysupdates #latestnews #globalupdates

#Trump’s victory: This is the impact on Asian markets and #investments #investing #asia #equity #bonds Read now ➡ https://lnkd.in/dh5vQgK5