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’China gets some can-kicking practice
Just last week, Patrick Chovanec was warning about the looming need to roll over debt in China:
Chovanec tells Nouriel Roubini the conflict between driving growth through investment-directed credit,
China’s hard landing odds, updated
Remember Nomura last year estimated there was a 1-in-3 chance of a hard landing in China?
Anyway, they’ve updated the index on which it was based. Nomura’s chief Asia economist, Rob Subbaraman, says the 1-in-3 odds indicated by the China Stress Index remain,
China’s not so amazing PMIs
China’s official PMIs went to 50.5 for January, but European markets were not that impressed.
The HSBC/Markit Economics PMIs, meanwhile, were an uninspiring 48.8, compared to 48.7 in December.
Societe Generale’s Wei Yao says that,
Chinese New Year and the BDI
Should you be worried about the Baltic Dry Index’s recent sharp selloff? Or should you be more worried about developments in China?
We bring this up because there is apparently somewhat of an après-Chinese New Year effect when it comes to the Baltic Dry Index.
The PBoC’s “unofficial” rate policy
Bank of America Merrill Lynch’s global rates teams has interesting note out on Friday regarding Chinese repo rates.
As they point out, the seven-day rate currently implies something of a liquidity crunch in the market.
A picture tells a thousand words, Chinese steel edition
Presenting, just another Wednesday working afternoon at a Chinese 5,800 cubic metre blast furnace factory:
Note the empty car park.
That picture comes to us courtesy of Nicholas Zhu of ANZ Bank via Simon Hunt,
Don’t worry, it’s normal for China’s GDP to appear a little weird
Still confused by China’s better than expected GDP numbers? (Especially given stories like this, and this, and this?)
You’re not the only ones.
Standard Chartered’s Stephen Green and Lan Shen, however,
China’s GDP, through stimulus-tinted glasses
China’s fourth quarter GDP figures are having a bit of a Rashomon effect on pundits.
From Reuters:
The data released on Tuesday may not satisfy investors, who were looking for figures that were either weak enough to provide a clear-cut case for policy easing or strong enough to allay fears that the world’s second-biggest economy might unravel.
China’s foreign reserves not so hot
China’s first quarterly decline in its forex reserves since 1998 has been described as a result of “hot money” leaving China. But there are a few other reasons — probably bigger ones.
Firstly, though,
Is China secretly consuming more, or not?
The Barclays Capital note we discussed earlier this week, postulating that China had already begun to see a critical increase in its household consumption-to-GDP ratio, has generated a few questions over email.
China gets shorty
In his latest move to support the development of China’s capital markets, Guo Shuqing, the newly installed head of the China Securities Regulatory Commission, will oversee the creation of a new body to control facilitate short-selling.
Snap news
Breaking pre-market news on Wednesday,
- Unicredit prices capital increase at €1.943 per share — Reuters.
- Next maintains profit outlook but narrows guidance; “A number of factors have subdued sales in the final quarter” – statement.
Are western central banks having an existential crisis?
David Wessel over at the Wall Street Journal has followed up on a story FT Alphaville has been covering for a while. That the world economy is running out of super-safe financial assets, and that this is doing untold damage to central banks’ abilities to control interest rates (the last bit is our spin).
A heretical glimpse into the ghost of copper future
Simon Hunt Strategic Services — the eponymous market analysis vehicle of copper market veteran Simon Hunt – has just published its 2012 outlook.
Be warned, though, it carries the following disclaimer:
China’s iron ore imports mystery, solved…
Earlier this week we looked at the rebound (of sorts) in China’s iron ore imports pricing from $120/tonne to almost $140/tonne, when much of the data was pointing to a deceleration in demand. At the same time,
As Chinese apartments go, so goes China
It seems that investors in Chinese shares are not feeling too optimistic of late:
Little sign of any of those risk-on blips on the newsflow from Europe or the US.
Chinese home buyers are also unhappy.
“Why the teacher is in such difficulties?”
Just in case anyone was thinking of dusting off the idea that China might bailout Europe, here’s a repeat of its demands: conferral of “market economy” status (for WTO purposes) and an “ironclad” guarantee that they’ll be paid back.
China’s mysterious November iron ore imports
In November, China’s PMIs signalled contraction, house prices fell in most cities, and inflation fell sharply. Trade, we learned over the weekend, is down down down. And as the FT notes, prices of petrochemicals,
Chinese CNH – YOURS!
Something is happening in China.
That’s the ominous title of an FX note posted by George Saravelos of Deutsche Bank on Friday morning.
It seems something is up in the big emerging market arbitrage window of the sky known as the onshore/offshore Chinese currency market.
The PBoC and that RRR decision
Did you wonder what was behind this?
Via Xinhua:
BEIJING — The People’s Bank of China, the country’s central bank, said Wednesday it will lower banks’ reserve requirement ratio (RRR) by 50 basis points for the first time in three years in order to replenish liquidity in the country’s banking system as inflation eases.
PMIs kick market when down
German bond auctions failing, IMF non-announcements driving market sentiment, Spain paying through the nose to fund itself, credit spreads blowing out, Dexia dragging down triple-A France, eurobonds getting vetoed again,
A Sino Fudge
Inquiry Clears Sino-Forest of Short Seller’s Fraud Charges screamed numerous headlines on Tuesday, following this statement from the embattled Chinese tree churner. An extract, quoting vice chairman and CEO Judson Martin:
Bolton keeps the faith
There is something positive Monday’s half year results from Anthony Bolton’s China Special Situations Fund.
He’s no longer worried about Kim Jong-il nuking South Korea.
In the last report I mentioned that I was concerned about the situation between North and South Korea.
Snap news
Breaking pre-market news on Monday,
- BHP Billtion to plough $4bn into US shale gas — statement.
- Sage rejects claims for damages by Archer Capital — statement.
- ITV reduces capex forecast;
Chinese stimulus *spoiler alert*
“So mild we might not even feel it” – is how Stephen Green and Wei Li at Standard Chartered anticipate the Q4 Chinese fiscal stimulus.
That would be the stimulus that everyone is hoping like mad will
Pettis and Kroeber go glass-half-full on China
Well, everyone needs a change sometimes.
We’ve written about so much bearish questioning on China that it wouldn’t be fair to ignore a couple of more upbeat comments from economists who are not the usual China bulls.
The Asian fuel-oil indicator
A particular grade of Asian fuel oil has, for want of another word, skyrocketed in price over the last few weeks.
The grade in question is called 380-centistoke, and its cash differential (versus the benchmark grade) has performed as follows:
G20 defers
Or, alternative headline: World fails to save Italy.
Seems like little has changed from the d(r)aft communique.
Click to read in full:
Choice morsels and Translation:
We stand ready to ensure
Five steps to financial crisis
The farce of the eurozone’s debt crisis is understandably captivating, but is an even bigger situation developing in China? Credit-fuelled gullibility lies at the heart of most bubbles, but such gullibility provides quality fodder for fraudulent schemes too.
The WTO dividend
You can say what you want about the achievements of the WTO; it sure is nice to be part of the club.
Certainly that is what the Kremlin will be thinking this morning after Russia cleared the final hurdle to joining the 153-nation trade organisation after 17 years of trying.