The Treasury International Capital (TIC) report produced somewhat of an anomaly in its update for August 2017. There was a lot going on during that month, mostly as UST yields fell (even though interest rates have nowhere to go but up, supposedly) while CNY continued its blistering ascent. As to the latter, it was quite clear by then Chinese actions [...]
It has been an unbelievably busy week on many fronts. Overshadowed by Chinese leader Xi Jinping and Austrian elections was continued “dollar” deterioration in FX. Further down the line than that, though in many respects related to it, was the UK government announcing the disappearance of half a trillion pounds. The news didn’t make much imprint in America, but it [...]
I really don’t think people quite understand just how much trouble China is in right now. That’s no mystery because in the Western media the Chinese economy is almost always described as somewhere between awesome and magnificent (only slight hyperbole). Their government, on the other hand, is not fooled. General Secretary Xi Jinping opened the Communist Party’s 19th Congress with [...]
The Office of the Comptroller of the Currency (OCC) reports that total gross notional derivatives contracts owned and outstanding by domestic banks rose for the second straight quarter. The OCC statistics are one quarter behind, meaning that though banks themselves are reporting Q3 numbers with earnings all figures shown here are from the official compilation for Q2. As such, the [...]
Industrial Production rose 1.6% year-over-year in September 2017. That’s up from 1.2% growth in August, both months perhaps affected to some degree by hurricanes. The lack of growth and momentum, however, clearly predated the storms. The seasonally-adjusted index for IP peaked in April 2017, and has been lower ever since. This pattern, the disappointment this year is one we see [...]
Chinese producer prices accelerated in September 2017, while consumer price increases slowed. The National Bureau of Statistics reported this weekend that China’s PPI was up 6.9% year-over-year, a quicker pace than the 6.3% estimated for August and a 5.5% rate in July. Earlier in the year producer prices were driven mostly by 2016’s oil rebound, along with those in the [...]
Chinese imports rose 18.7% in September 2017 year-over-year. That’s up from 13.5% growth in August. While near-20% expansion sounds good if not exhilarating, it isn’t materially different from 13.5% or 8% for that matter. In addition, Chinese trade statistics tend to vary month to month. What is becoming very clear is that China’s economy is behaving no differently than the [...]
There are supposedly jobs that Americans won’t do, and now there are, apparently, jobs that British won’t do. In the latter case, according to the UK’s Minister of State and Commonwealth, Sir Alan Duncan, it is the Europeans who were blamed for taking work from native English. The result was, in his view, Brexit. Duncan called it a “tantrum” last [...]
At the end of Q3 2015, on September 29 that year, the overnight HIBOR (Hong Kong unsecured delivery of HKD) rate fixed at 0.0507%. That was barely changed from the days and even months leading up to that point even though it was the last of regular trading before the start of China’s Golden Week. Despite enormous illiquidity throughout the [...]
The Federal Reserve Bank of NY reported on Friday that repo fails for the week of September 20 were $359 billion (combined “to receive” plus “to deliver”). That’s the second highest weekly total of this year, following $435 billion fails recorded just two weeks earlier. The week in between those two was also high, tallying $325 billion. That makes for [...]
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