China’s fiscal surge, US election uncertainty, space sector growth and ESG's long-term potential
This week's chart pack covers the following topics:
China’s credit surge may struggle to fuel growth
Macrobond users can click here to access the chart and gain deeper insights into the data.
What the chart shows
The chart tracks China’s credit impulse (a measure of new credit as a share of GDP) offset by three months to align with the Li Keqiang Index, which measures total bank loans, electricity consumption and rail cargo volume. This reflects the strong five-year rolling correlation between the two measures.
The chart tracks China’s credit impulse—changes in new credit as a share of GDP—advanced by three months relative to the Li Keqiang Index, an economic indicator that includes bank loans, electricity consumption, and rail cargo. It highlights the strong five-year rolling correlation between these two variables.
Behind the data
China has rolled out fiscal measures, including bond issuances worth 6 trillion yuan ($850 billion), following earlier monetary steps. This move is expected to inject liquidity into the economy, possibly pushing the credit impulse into positive territory and spurring economic activity. However, with economists voicing doubts about the country meeting its 5% GDP growth target as we enter Q4 2024, the effectiveness of these measures remains in question.
Polling vs betting: Can Harris hold her lead in critical swing states?
Macrobond users can click here to access the chart and gain deeper insights into the data.
What the chart shows
This chart compares polling data from 14 swing states with betting odds, providing a snapshot of the US election race. The left column shows polling averages from FiveThirtyEight, while the right column presents Polymarket betting odds. For example, a 62.6% polling figure for Kamala Harris in in California indicates that of the votes cast between her and Donlad Trump, Harris is expected to win 62.6%. Both major candidates typically poll slightly lower overall in each state as third-party candidates capture a small portion of the vote. To simplify the chart, potential third-party votes have been excluded.
Behind the data
The US election is shaping up to be decided by a few critical swing states, with Pennsylvania, Michigan, Wisconsin, and Nevada showing the tightest contests, according to Polymarket odds. Although Harris holds a polling lead in these states, betting markets still slightly favor Trump, reflecting his past outperformance of polling predictions. This gap between polling data and market odds suggests that investors are factoring in historical trends more heavily than current polls.
ESG vs energy: How regional differences shape risk-adjusted returns
Macrobond users can click here to access the chart and gain deeper insights into the data.
What the chart shows
This chart compares the 10-year Sharpe ratios – a measure of risk-adjusted returns – of ESG stocks (MSCI ESG Leaders Index) and energy stocks (MSCI Energy Sector Index) across developed markets including Australia, Canada, Europe, Japan, the UK and the US.
Behind the data
ESG stocks are often seen as aligning with broader social and environmental goals, but how do they perform against traditional energy stocks? To explore this, we analyzed the risk-adjusted returns of ESG stocks versus counterparts in the fossil fuel sector using the 10-year Sharpe ratio.
In markets like Australia, Canada, Europe and the US, the ESG leaders have outperformed traditional energy stocks, demonstrating their potential for both ethical and financial returns. However, in Japan and the UK, oil and gas stocks have delivered comparable or even superior risk-adjusted returns, highlighting how regional factors such as energy policies and market structures can influence investment outcomes.
💡 Receive Charts of the Week directly in your inbox
To receive weekly insights based on the world’s most extensive macroeconomic, aggregate financial and sector data directly in your inbox, subscribe now: