Chinese monetary policy is driven primarily by RMB speculation

There is an article in this week’s Caijing that summarizes a survey by Deutsche Bank’s Jun Ma (here, for those who can read Chinese). I haven’t managed to get it translated yet but one of my regular blog readers, Kar Kheng Giam, summarized it for me. According to the survey, the ways enterprises bring into […]

Inflation won’t peak yet

According to today’s Credit Suisse Emerging Markets Economics Daily, a government official for the first time suggested that we are not going to see inflation peak this year. Earlier this year most commentators and nearly all government officials suggested that inflation would peak in the second quarter before coming down over the rest of 2008. […]

Lower inflation in May?

According to today’s China Daily Morgan Stanley is predicting that year on year inflation for May is likely to decline dramatically from 8.5% in April to 7-6-8.0% in May. I haven’t seen the Morgan Stanley report but the article says “vegetable prices in the third week of May dropped 5.6 percent week-on-week, meat was down […]

No but this time really is different

Today is relatively quiet on the China-financial-news front (the SSE Composite was down 36 bps, but not much else happened), so rather than discuss the most recent numbers and events and their possible implications for financial policy, I want to write about something a tad more theoretical. For the past two months there has been […]

The informal banking sector is growing

After yesterday’s stock market excitement, the government “quashed” rumors today that they were going to relax prices on refined oil products.  According to China Daily, “the National Development and Reform Commission (NDRC), China’s economic planning agency, said rumors that the authorities plan to relax domestic oil and gas price controls are baseless.” The Shanghai Securities News, […]

PBoC is biased towards more tightening

My third-year finance undergrad, Liu Bing, who is following in the footsteps of Logan Wright and becoming a central-bank sleuth and obsessive (almost literally following in his footsteps, I guess, since he is interning at Stone & McCarthy), sent me the following email today.  I have edited it slightly: The PBOC released the Q1 monetary […]

Lots of speculation on oil price hikes

I don’t normally write so much about the stock market but today, like yesterday, the stock market seems to be at the center of events. Not unexpectedly the SSE Composite started the day badly after yesterday’s awful 4.5% drop to 3443. By midmorning it was down a whopping 2.6%, to 3355. Later in the morning, […]

The effect of the earthquake is increasing uncertainty

The stock market seems to be getting increasingly worried about the economic impact of the earthquake, even though Sichuan province comprises just 4% of China’s GDP production and most of Sichuan’s most developed areas, including its capital Chengdu, were left relatively unscathed. Still, it seems that uncertainty has increased in a variety of areas and […]

The devastating earthquake is also bad for monetary policy

This has been a sad week for China, and it has certainly not been easy to watch on television the heartbreaking scenes of the effect of Monday’s earthquake. Sichuan is a heavily populated province, and many of my students have friends and family in the affected areas, so the disaster has hit us very hard. […]

Demographic projections and trade implications

With yesterday’s bad April CPI number, the subsequent increase in minimum reserve requirements to 16.5%, and the slowing will-they-won’t-they appreciation of the RMB, it is tempting to stick to monetary topics in this and the next few blog entries, but regular readers know what I am going to say anyway. First, inflation may get a […]

1 25 26 27