In today’s briefing:
- Korean Government Announces Tax Incentives for Shares Cancellation and Dividends
- Japan Removes Negative Interest Rate Policy – The End of an Era and Long Yen?
- CX Daily: China’s Challenge To Fill The Multibillion-Dollar Insurance Blackhole
- Positioning Watch – Commodities are back on, and so are cyclical equities
- Russia: Putin 5.0
- Global Politics: As US Election Heats Up, Asia May Catch More Than Just a Cold
- Canada CPI Inflation 2.78% y-o-y (consensus 3.1%) in Feb-24
- Japan Policy Rate 0.0% (consensus 0.0%) in Mar-24
- Great Game – Who Can Stop Putin? Can Nigeria Keep Out Crypto?
- UK CPI Watch: Softer than priced in..
Korean Government Announces Tax Incentives for Shares Cancellation and Dividends
- On 19 March, Choi Sang-Mok announced that the Korean government plans to provide corporate tax reduction benefits to companies that cancel their treasury shares.
- The separate taxation of dividend income is also expected to be promoted. All of these are law amendment issues and must go through the legislative process of the National Assembly.
- At this time, the Korean government did not provide the entire details about the exact amount of corporate tax reductions from share cancellation and separate taxation of dividend income.
Japan Removes Negative Interest Rate Policy – The End of an Era and Long Yen?
- Zooming out reveals that the Bank of Japan has not shifted to a different monetary policy regime.
- The negative relationship between total debt-to-GDP and interest rates has been confirmed once again.
- With the Federal Reserve poised to cut rates more than three times this year, the case for a short yen position is thin.
CX Daily: China’s Challenge To Fill The Multibillion-Dollar Insurance Blackhole
- Insurance / Cover Story: China’s challenge to fill the multibillion-dollar insurance blackhole
- Corruption /: Ex-Beijing hospital president taken away by corruption investigators
- Listings /: China issues stringent rules to tighten listing controls and tackle financial fraud
Positioning Watch – Commodities are back on, and so are cyclical equities
- Finally some action from the BoJ earlier today with a 10 bps hike, in line with market expectations after it was rumored that they would tweak policy last week.
- The BoJ has, with barely no exceptions, leaked all their policy moves to the press before actually moving the needle, and dynamics post the meeting is nothing less than a classic “buy the rumor sell the news”.
- It looks like markets had hoped for some clarity on the path for the policy rate, which they weren’t given this morning (more on the BoJ meeting here).
Russia: Putin 5.0
- Vladimir Putin’s election victory is seen as a result of not just rigging, but also due to many Russians not seeing an alternative.
- The ongoing war in Ukraine or the declining non-war economy is not expected to significantly alter this perception.
- Putin is already focusing on securing another election victory in 2030.
Global Politics: As US Election Heats Up, Asia May Catch More Than Just a Cold
- A tight race between two less than popular presidential candidates, makes for a campaign that will be nasty, brutish, and long.
- A Washington distracted by the election and domestic issues provides an opening to rivals such as North Korea, Iran, China and Russia to embark on mischief-making.
- Whoever wins, “America First” foreign economic policy will be here to stay, and Asia will have to learn to deal with this new reality.
Canada CPI Inflation 2.78% y-o-y (consensus 3.1%) in Feb-24
- Canada’s CPI inflation rate in February 2024 was 2.78% year-on-year, lower than the expected rise to 3.1%.
- Underlying measures of inflation also showed a decrease.
- This indicates a relatively subdued inflationary environment in Canada.
This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.
Japan Policy Rate 0.0% (consensus 0.0%) in Mar-24
- The Bank of Japan has raised its policy rate to 0.0%, ending the negative interest rate policy in anticipation of achieving its 2% price stability target sustainably.
- This policy shift reflects the BOJ’s confidence in Japan’s economic recovery, underpinned by improved corporate profits, likely continued wage increases, and the formation of a more solid virtuous cycle between wages and prices.
- Future BOJ policy decisions will hinge on economic activity and price developments, global economic conditions, and the trajectory of inflation expectations and wage growth, with a continued focus on achieving sustainable price stability.
This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.
Great Game – Who Can Stop Putin? Can Nigeria Keep Out Crypto?
- Welcome to this week’s Great Game, where we’ll cover the Russian election as well as the ongoing turmoil in Nigeria.
- Vladimir Putin won a “landslide” win over the weekend with almost 90% of the votes.
- That was completely as expected and really no news there.
UK CPI Watch: Softer than priced in..
- Welcome to our UK CPI preview.
- We find the market consensus overly hawkish ahead of the release tomorrow and especially see softness in Services and Food relative to the market pricing.
- February is typically not an overly seasonally hot month for inflation, but in 2022 and 2023, February inflation printed at worrisome levels MoM.
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