Tag Archive: China Retail Sales

FX Daily, May 15: Angst Continues

Overview: Disappointing Chinese April data spurred speculation that more stimulus will be forthcoming and bolsters hopes that a trade deal with the US by the end of next month helped Asian Pacific equities advance for the first time this week.  Indonesia, which reported a record trade deficit on the back of collapsing exports (-13.1% year-over-year in April, nearly twice the decline expected after a 10% fall in March) kept the pressure on its...

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Coloring One Green Shoot

China’s Passenger Car Association reported last week that retail sales of various vehicles totaled 1.78 million units in March 2019. The total was 12% less than the number of automobiles sold in March 2018. This matches the government’s data, both sets very clear as to when Chinese economic struggles accelerated: May 2018.

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Something Different About This One

In Japan, they call it “powerful monetary easing.” In practice, it is anything but. QQE with all its added letters is so authoritative that it is knocked sideways by the smallest of economic and financial breezes. If it truly worked the way it was supposed to, the Bank of Japan or any central bank would only need it for the shortest of timeframes.

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China’s Eurodollar Story Reaches Its Final Chapters

Imagine yourself as a rural Chinese farmer. Even the term “farmer” makes it sound better than it really is. This is a life out of the 19th century, subsistence at best the daily struggle just to survive. Flourishing is a dream.

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The Relevant Word Is ‘Decline’

The English language headline for China’s National Bureau of Statistics’ press release on November 2018’s Big 3 was, National Economy Maintained Stable and Sound Momentum of Development in November. For those who, as noted yesterday, are wishing China’s economy bad news so as to lead to the supposed good news of a coordinated “stimulus” response this was itself a bad news/good news situation.

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China hard data for October reveals mixed picture

Disappointing consumption numbers point to growth deceleration in early 2019, but government measures beginning to be felt.Hard data out of China for October was mixed. On the positive side, growth in infrastructure picked up, suggesting the government’s fiscal policy easing is taking effect in the real economy. Industrial production numbers stopped declining, and the mining sector has a particularly strong performance.

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FX Daily, September 14: Dollar Losses Extended

The US dollar remains on the defensive after retreating yesterday.  Its losses against the most of the major and emerging market currencies are being extended today.  The combination of softer US inflation coupled with a less dovish than expected ECB, a Bank of England lifting growth forecasts, while warning that a Brexit without an agreement could spur higher mortgage rates, and a more aggressive rate hike by Turkey conspired to force the dollar...

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FX Daily, July 16: Dollar Softens a Little as Market Awaits Developments

The US dollar is slightly softer against most of the major currencies but is in narrow ranges ahead of today's key events, which include US retail sales and the debate in the UK parliament over Brexit.  The yen is the main exception.  The local markets are closed for a public holiday, and the yen did initially strengthen (the dollar eased to ~JPY112.10) but surrendered those gains and consolidating its biggest loss last week in 10 months.

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FX Daily, June 14: Dollar Punished Ahead of ECB

The US dollar is slumping against all the major currencies in the aftermath of the hawkish Federal Reserve. In fact, the inability of the greenback to hold on to the gains scored in the initial reaction to the Fed's hike, optimism on the economy, and the signal of hikes in September and December, foretold today's push lower.

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Anchoring Globally Synchronized Growth, Or We Gave Up Long Ago?

January was the last month in which China’s National Bureau of Statistics (NBS) specifically mentioned Fixed Asset Investment (FAI) of state holding enterprises (or SOE’s). For the month of December 2017, the NBS reported accumulated growth (meaning for all of 2017) in this channel of 10.1%. Through FAI of SOE’s, Chinese authorities in early 2016 had panicked themselves into unleashing considerable “stimulus.”

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FX Daily, May 15: Firm US Rates Underpin Greenback

US 10-year rates are again probing the air above 3%, and this is encouraging a push back toward JPY110, with the euro slipping toward $1.19.  Asian equities fell, with the MSCI Asia Pacific shedding 0.8%, the most in nearly a month, snapping a three-day advance. China and India were able to buck the regional move. China's economic data was mostly softer than expected and is consistent with a gradual turn in the cycle as the Lunar New effect fades.

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FX Daily, April 17: Dollar Recovers from Further Selling as Turnaround Tuesday Unfolds

After the retreating in the North American session yesterday, despite a rebound in retail sales after three-months of declines, the greenback has been sold further in Europe and Asia. The euro edged through last week's high near $1.24, and sterling rose through the January high to reach its best level since the mid-2016 referendum. Sterling rose through $1.4375 before the easing after the employment report.

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China’s Questionable Start to 2018

The Chinese government reported estimates for Industrial Production, Retail Sales, and Fixed Asset Investment (FAI) for both January and February 2018. The National Bureau of Statistics prepares and calculates China’s major economic statistics in this manner at the beginning of each year due to the difficulties created by calendar effects (New Year Golden Week).

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The Blatant Dishonesty of the ‘Boom’

Why do humans tend to behave in herds? It’s a fundamental question that only recently have researchers been able to better understand. On the one hand, it doesn’t take an advanced degree in some neurological science to see the basis behind it; survival for our ancestors often meant getting along with the crowd. There are times when that very trait applies still.

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FX Daily, January 18: Currencies Consolidate After Chop Fest

The US dollar rallied in the North American afternoon yesterday and the timing coincided with the release of the Fed's Beige Book that saw several districts report wage and price pressures. The US 10-year yield moved toward toward 2.60%, and helped by speculation that as US companies repatriate earnings kept abroad that they may have to liquidate the investments, some of which are thought to be in Treasuries.

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Chinese Are Not Tightening, Though They Would Be Thrilled If You Thought That

The PBOC has two seemingly competing objectives that in reality are one and the same. Overnight, China’s central bank raised two of its money rates. The rate it charges mostly the biggest banks for access to the Medium-term Lending Facility (MLF) was increased by 5 bps to 3.25%. In addition, its reverse repo interest settings were also moved up by 5 bps each at the various tenors (to 2.50% for the 7-day, 2.80% for the 28-day).

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FX Daily, December 14: US Rates Bounce Back, but Dollar, Hardly

US interest rates have recovered the drop seen after the FOMC yesterday, but the dollar at best has been able to consolidate its losses and at worst, seen its losses extended. The Fed boosted its growth forecasts and lower unemployment forecasts. Yet its interest rate trajectory and inflation forecasts were largely unchanged. Yellen, as her recent predecessors have done, played down the implications of the flattening of the yield curve.

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Globally Synchronized Downside Risks

Oil prices were riding high after several weeks of steady, significant gains. It’s never really clear what it is that might actually move markets in the short run, whether for crude it was Saudi Arabia’s escalating activities or other geopolitical concerns. Behind those, the idea of “globally synchronized growth” that is supposedly occurring for the first time since before the Great “Recession” while it may not have pushed oil investors to buy...

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FX Daily, November 14: Euro Rides High After German GDP

Sterling is trading in the lower end of yesterday's range and has been confined to about a quarter a cent on either side of $1.31. On the other hand, the euro has pushed a bit through GBP0.8950 to reach its best level since October 26. Sweden also reported softer than expected October inflation.

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FX Daily, October 19: Kiwi Drop and Sterling Losses Punctuate Subdued FX Market

The 30th anniversary of the 1987 equity market crash the major US benchmarks at record highs. The drop in the market was at least partly a function of the lack of capacity, sufficient instruments, and regulatory regime. Each of these factors has been addressed to some extent. Circuit breakers have been introduced, and have evolved. The financial capacity has grown immensely.

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