In this briefing:
- Flash During Trade Talks
- China’s Coal Conundrum
- Asia’s External Balances Signal Safety for Investors
- Trade Talks/Huawei/ Stock Surprise/Monetary Policy /Greater Bay Area
- UK Trip – Wake up to Deflation Risk
1. Flash During Trade Talks
So we hear that President Trump may be doing something in Vietnam prior to the March 1 trade deadline. Even though Trump tweeted the tariffs will not be implemented on March 1, you can be sure that negotiations are still going at full speed. However, in the shadow of trade talks we are looking at China’s Flash numbers as an indicator of economic health.
2. China’s Coal Conundrum
Last Friday China torpedoed Australia’s coal imports after announcing that the middle kingdom would no longer accept coal imports from Australia. This leads us to consider some of the energy issues related to China. We write often about coal and the importance it has on China’s energy consumption.
3. Asia’s External Balances Signal Safety for Investors
Asian currencies are, in general, well supported by economic fundamentals in the form of external surpluses and interest rate differentials. Indeed, most Asian currencies display an appreciating bias, contrary to perceptions in 2018 when all of them lost ground to the US dollar. Over the last year the underlying external strength has been reflected in Asian currency appreciation against the US dollar.
4. Trade Talks/Huawei/ Stock Surprise/Monetary Policy /Greater Bay Area
China News That Matters
- Nearing an agreement?
- Can´t live with ´em, can´t live without ´em.
- Just a trillion greenbacks up since January.
- Prudence please, no “flood-style” irrigation.
- Wear flowers in your hair.
In my weekly digest China News That Matters, I will give you selected summaries, sourced from a variety of local Chinese-language and international news outlets, and highlight why I think the news is significant. These posts are meant to neither be bullish nor bearish, but help you separate the signal from the noise.
5. UK Trip – Wake up to Deflation Risk
By Bo Zhuang, Chief China Economist
- London-based investors are turning cautiously optimistic on China’s growth outlook amid the latest easing measures in January
- There is still little awareness about the rising deflation risk
- Interest in the trade war has subsided
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