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Economy

2023 Key Views: ‘Chimerica’ In Trouble
Special Report

Both the US and China have structural imbalances that need correcting. The former has a structurally imbalanced labour market in which demand far outstrips supply. The latter has a massively overvalued housing market. The concurrent correction of these two structural imbalances in the world’s two largest economies will necessitate a sharp slowdown in global growth, and leads to several investment conclusions.

Counterpoint by Dhaval Joshi
Euro Area Industrial Production Disappoints In October
Eurozone industrial production declined by a larger-than-expected 2.0% m/m in October, following a 0.8% m/m expansion. Meanwhile, output growth slowed from 5.1% to 3.4% on a year-on-year basis. The energy sector (-3.9% m/m), durable consumer goods (-1.9% m/m)…
Daily Insights
Japan: Manufacturing And Services Diverge
The Tankan survey for Q4 underscored a dichotomy in sentiment between Japan’s manufacturing and service sectors. Japan’s largest manufacturing firms’ assessment of current business conditions deteriorated for the fourth straight quarter. Meanwhile, sentiment…
Daily Insights
China’s Reopening: Impact On The Rest Of The Word
According to BCA Research’s China Investment Strategy service, China’s reopening is much more positive for the Chinese economy than it is for the rest of the world. Reopening will boost service sector activity and consumer spending much more than the…
Daily Insights
2023 Key Views: China’s Reopening, Impossible Trinity, And Beyond
Special Report

How to play the reopening? Which sectors will benefit the most? What will be the impact of the reopening on the rest of the world? Why is the PBoC facing the Impossible Trinity? Why has the PBoC tightened liquidity, prompting a rise in onshore interest rates? What are the implications for interest rates and the currency going forward? Is it time to upgrade Chinese onshore and offshore stocks?

China Investment Strategy
US CPI Inflation Eases Further In November
US CPI inflation cooled for a second consecutive month in November. The headline figure eased to 0.1% m/m (7.1% y/y), falling below consensus estimates. Core inflation was also softer-than-anticipated, moderating to 0.2% m/m (6.0% y/y) from 0.3% m/m (6.3%…
Daily Insights
Stagflation Dominates UK Economy
Conflicting forces are dominating the UK labor market. Data released on Tuesday revealed that the unemployment rate ticked up from 3.6% to 3.7% in the three months to October (the second consecutive increase), providing some evidence of cooling employment…
Daily Insights
Towards A Euro Area Manufacturing Rebound?
The ZEW survey of investor sentiment sent an upbeat signal about economic conditions in both Germany and the Eurozone in December. The headline index for Germany rebounded by 13.4 points to -23.3 while the Eurozone measure jumped 15.1 points to -23.6. Both…
Daily Insights
China’s Credit Expansion Falls Short Of Expectations
Chinese credit rebounded in November, after plunging in the preceding month. New loans expanded by CNY 1.2 trillion, double October’s levels. Similarly, aggregate financing – a broad measure of credit and liquidity – increased by CNY 2.0 trillion following…
Daily Insights
S&P 500 Pricing Power: A Sector Breakdown
On aggregate, US firms experienced a sharp increase in pricing power following the initial shock of the COVID-19 pandemic. However, this trend has since reversed, and companies’ pricing power is fading. The darkening economic backdrop ultimately limits firms’…
Daily Insights

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