In today’s briefing:
- China: Capital Flight Limits Easier Money Amid Spreading Crisis in Property Markets
- UK: BoE Pulled Two Ways
- CX Daily: ByteDance Faces Tough Sell Abroad in Bid to Commercialize TikTok
China: Capital Flight Limits Easier Money Amid Spreading Crisis in Property Markets
- Over the latest 12 months, China’s FX reserves declined by US$177bn despite a trade surplus of US$889bn, implying net services/income and capital outflows of US$1.07trn within the past year.
- China cut mortgage rates twice in May-Aug’22, but residential property prices declined on a 12mma basis for the first time, & floor space completed/sold declined by the most ever.
- Amid global monetary tightening, China can’t ease without a further RMB slump. Real GDP will only grow 3% in 2022, with risks to the downside as property/industrial overcapacity are exacerbated.
UK: BoE Pulled Two Ways
- The UK unemployment rate fell again in Aug-22 to a record low of 3.5% as leaving the labour market remains too attractive a draw.
- Vacancies fell further from their highs, but the pent-up demand keeps stoking wages above levels consistent with the inflation target, pulling the BoE to tighten forcefully.
- Policies are moving fast and breaking things, most visibly in the gilt market. The BoE is pulled to draw a line in the sand and should reconsider QT in November.
CX Daily: ByteDance Faces Tough Sell Abroad in Bid to Commercialize TikTok
Cover Story: ByteDance faces tough sell abroad in bid to commercialize TikTok
Xi briefs Central Committee on Party Congress work report
Analysis: How a Chinese mRNA Covid vaccine was approved in Indonesia
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