Policy
According to BCA Research’s China Investment Strategy team, China’s fiscal support will be limited due to political and economic factors. China has heavily relied on government expenditure support to sustain its economic growth in recent years. However,…
As expected, the Bank of Canada raised interest rates for the second consecutive month after restarting its tightening campaign last month. At 5.0%, the policy rate now stands 4.75 percentage points above where it was at the start of the tightening cycle last…
An outlook for inflation and Fed policy following this morning’s CPI report.
The stratospheric valuation of this year’s AI mania is likely to deflate, just as it did after the Web 1.0 mania of the late 90s. We go through some long-term and short-term investment implications.
The Politburo meeting in late July will set the course for economic policy for 2H23. We think China will only resort to "irrigation-style" stimulus if something breaks in the economy and/or financial markets. Furthermore, the gradual and targeted rounds of stimulus are unlikely to boost economic activity considerably. The reasons are the diminished efficacy of the monetary transmission mechanism and the unique features and constraints of the nation’s fiscal system.
China’s credit expansion surprised to the upside in June. Aggregate social financing totaled CNY 4.22 trillion – above expectations of CNY 3.10 trillion and exceeding CNY 1.56 trillion in the prior month. Similarly, the CNY 3.05 trillion worth of new…
Hot UK wage data focused investors’ attention on the Bank of England’s battle against sticky inflationary pressures on Tuesday. The 7.3% y/y increase in weekly earnings (excluding bonuses) in the three months to May surpassed expectations of a 7.1% y/y rise…
The latest update of the Manheim Used Vehicle Price Index provides a positive signal for US goods inflation. It shows used car prices fell by -4.2% m/m (-10.1% y/y) in June – its third consecutive monthly decline following a brief pickup in…
China’s CPI and PPI inflation updates indicate that deflationary pressures continue to dominate the domestic economy in June. Producer prices declined at a faster pace than in the prior month, falling by -5.4% y/y following a -4.6% y/y decrease in May, and…
On Monday, the Eurozone Sentix sent a pessimistic signal about investor confidence in the Eurozone economy. The headline index dropped from -17.0 to -22.5 in July, significantly below expectations of a more muted deterioration to -17.9. Both the Expectations…