Tag: CNY
April
China: Q2 opens on a weak note
The preliminary HSBC/Markit manufacturing PMI for China was a disappointment, falling from 51.6 to 50.5 in April. This does not change our expectations of a gradually recovering Chinese economy, but is a sign of China adapting to a lower growth environment.
Chinese growth disappoints in Q1
China’s sluggish Q1 GDP growth weakens expectations that the global recovery had gained strength at the beginning of the year. Nevertheless, credit growth picked up steam in March, which raises expectations of accelerating growth in Q2.
March
China’s 12th People’s Congress: the key word is people
Premier Wen Jiabao’s speech at People’s Congress opening today was lengthy and offered little news that could shake the markets to the core. Nonetheless, it was positive to confirm that the future economic policies will increasingly emphasise on improving the livelihood of ordinary people. New president and premier will inaugurated between 13 and 16 March.
No smooth sailing in Chinese recovery
The Chinese industrial sector has cooled down in February. It did not come as a surprise to us, as we have always believed in an uneven recovery path, where the export sector remains as a key risk factor. We continue to see the Chinese economy ticking upwards in the coming months.
January
Stronger Q4 GDP suggests turning point for China
The Chinese economy expanded by 7.9% y/y in the fourth quarter and the full-year growth for 2012 became 7.8%, thanks to public infrastructure investments and rebound in the house market. We expect the recovery to continue in 2013 with a full-year growth rate of 8.1%. We do not believe the PBoC will cut interest rates in 2013. The CNY will be kept as a potential tool to help exporters.
Fresh Chinese data shows that the economy gains strength
Fresh Chinese data this morning supported our longstanding view that the Chinese economy is turning towards brighter days. December exports grew by 14%. Off-balance-sheet credit was very high, indicating the overall credit conditions were not as tight as they appear. Generally, we expect the economy to continue recovering thanks to fiscal stimulus.
December
China: PMIs continue upwards
The November PMIs from both the official and private (HSBC/Markit) sources have continued upwards. The readings support our stance that the Chinese economy is bottoming out and a robust recovery is expected during the first half of 2013.
October
EM FX Monocle – A bird in hand…
With more easing unleashed by major central banks in September the EM FX has come into spotlight again as investors rush for carry in low volatility environment. Remain long EM FX, but mind the low perception of risk prevailing in the markets and hedge the sensitive EM exposures while cheap – better be safe than sorry.
September
China: Stability, stability and … stability
Here is a presentation of our new Economic Outlook for China - Stability, stability and ... stability
Asia FX Outlook: Beggar-thy-neighbour policies
The Asian FX outperformance vs. the USD from the past two months may be reversed in the short term, as prospects for the global economy continue uncertain. A weaker currency is more than welcome for the Asian policy makers.
Bleeding industrial sector puts pressure on additional stimuli
The Chinese manufacturing sector continues to suffer. Deteriorating employment situation prompts for an interest rate cut to ease the funding burden faced by struggling manufacturers. Policy makers’ cautious attitude will remain and no quick rebound in the economy is expected.
August
EM FX Monocle – Test time
"Into summer lull" turned out again to be the right call in the June EM FX Monocle – no major moves over summer, but FX volatilities lower and EM FX gained vs the USD as risk perception improved.
Drop in Flash PMI calls for more stimulus from Beijing
China’s HSBC/Markit Flash PMI dropped to its nine-month low in August, dragged by both output and orders sub-indices. The very weak numbers call for additional stimulus measures from Beijing which we expect to be taken shortly.
Chinese data adds uncertainty to the outlook
Chinese July data this morning surprised on the downside. We see an increased possibility of central bank action within a month, as the National Congress of the Communist Party is approaching and the stability-obsessed officials want to maintain confidence in the leadership.
Chinese manufacturing remains fragile, leaders pledge more aid
The Chinese manufacturing sector remains fragile as shown in the July PMI numbers. This is fits our view that recovery in the second half of this year will be slow. Though the country's leaders have pledged a focus on growth, measures in terms of investments may cause more problems in the longer term.
July
China Flash: pick up in Flash PMI albeit still fragile industrial sector
China’s HSBC/Markit Flash PMI picked up modestly in July, reaching the highest level since February this year. We maintain our projection that Chinese economy will recover gradually during the second half of the year.
China growth below 8% for the first time in three years
Chinese economy grew by 7.6% in Q2. It was the lowest growth in three year but in-line with expectations. We do not expect to see the economy slow further but rather pick-up steam.
June
EM FX Monocle – Into the summer lull
"Life after the storm" was a good title for our May EM FX Monocle – indeed, EM FX volatilities have declined and the currencies started to recover in June.
Det asiatiske valutamarked – Ikke de bedste udsigter
De asiatiske EM-valutaer blev svækket over en bred kam i maj som følge af faldende tillid på det globale marked efter en optimistisk start på året og et roligt forår.
Asia FX Outlook: Not the best of times
Sentiment took a turn for the worse in May, which was also reflected in a broad range of Asian currencies.
Asia FX Outlook: Not the best of times
Sentiment took a turn for the worse in May, which was also reflected in a broad range of Asian currencies.
May
Emerging Markets FX Monocle – Life after the storm
The storm did come after the calm, as our April issue of the Monocle suggested. It may get worse before it gets better in the coming weeks, but not for long.
Lots of news to digest next week
Outlook for next week's key figures and events in the US, the euro area, China, Japan, UK, Canada, Switzerland, Australia and New Zealand.
CNY update: Stuck at 6.30 despite stronger fixing
The CNY has in recent days taken advantage of its broadened band, as the fixing has been pushed clearly higher. We still expect a gradually stronger CNY towards the end of the year.
April
Asia FX Outlook: Stabilisation – where to next?
After a strengthening early on in the year, many Asian currencies have held steady over the past month or two.
CNY – højere volatilitet og handelsomkostninger
Der er nu gået en god uge siden de pengepolitiske myndigheder i Kina besluttede sig for at udvide de daglige udsvingsgrænser for spotkursen USD/CNY.
Emerging Markets FX Monocle – Calm before the storm?
Following the good start of the year, EM currencies did not hold on to the gains. Yet the orderly gradual EM FX decline has not produced much volatility creating the impression of a bomb waiting to explode if only another “black swan” event strikes.
Trading band of the CNY widened – increased unertainty ahead
The trading band of the CNY around the USD was widened from +/-0.5% to +/-1.0% around the central parity set by the central bank, which was no huge surprise after recent comments.
Trading band of the CNY widened – increased unertainty ahead
The trading band of the CNY around the USD was widened from +/-0.5% to +/-1.0% around the central parity set by the central bank, which was no huge surprise after recent comments.
New lending soars in China
New lending in China reached CNY 1010bn in March, picking up clearly from January and February. Although this supports expectations of a gradually turning Chinese economy, we continue to expect further reserve requirement cuts this year, as the economic outlook remains fragile.
Impressions from China
Based on impressions from Hong Kong and Shanghai: We expect mostly negative news in the coming months, but the real challenges are in the medium term - in finding Modern Chinese Communism.
March
Impressions from China II – Swift renminbi internationalisation
Renminbi internationalisation might be relatively swift. Gradually extending the use of CNH to include more capital transactions and promoting local currency invoicing among Chinese companies are likely ways to continue the process.
Impressions from China I – Modern Chinese Communism
The economy is slowing, house prices are falling, market-based construction has stalled, and local government debt is a key concern. Yet the real challenges are in the medium term - in modernising China.
Emerging Markets FX Monocle – a lot of news, little action
Risk is mispriced, again. And hence caution is still essential. But unless some of the key risks actually materialise, we are most likely to see Emerging currencies drift stronger over the coming months.
February
Surprise acceleration in Chinese inflation
Contrary to expectations, inflation broke a five-month easing trend in January. Monetary easing still expected, but pushed back.
January
Emerging Markets Outlook 2012
Many interesting and globally important stories in easily digestable format.
December
Asia FX Outlook
European debt crisis continues to weigh on Asian currencies
November
China commits to move faster towards a market-based exchange rate
In a draft action plan for the G20 meeting, China commits to more currency flexibility.
Slowdown not “made in China”
No hard landing in China. If the situation abroad worsens, the authorities still have enough room to manoeuvre.
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