Now that the FOMC has done it, we get to hear about how it was surely the “right” time for it. Unlike September, conditions are supposedly an order of magnitude more settled. That has given the policymaking economists the green light to make sure they start the normalization process before “overheating” becomes the central concern. With August a fading memory, [...]
Industrial production in China accelerated in November to 6.2% from an abysmal 5.6% in October. As per usual, any similar change is met with assurances that this time, unlike all prior, everything is working. It has become a regular game of ill-considered contention, as every single move in IP or some other factor that stops declining is immediately and confidently [...]
The latest developments from China’s monetary realm were the IMF’s inclusion of RMB into its “reserve” basket, and at a proportion greater than either the pound or yen. None of that is surprising, however, nor is it truly meaningful as a practical matter. The change is more of an official stamp upon what transpired long ago, with little bearing on [...]
There are times when you can distill the utterly complex into something elegantly simple. This is one of those times, as there really should be no doubt as to “what” and “why” about December so far. From repo to crashing EM’s to crude oil, the common theme is both eurodollar and Asian “dollar.” In that sense, it might be fair [...]
China’s trade estimates continue the trend of the global economy pushing closer to recession, assuming that it is not already there. We know that the lower part of the global supply chain below Chinese manufacturing and assembly, the resources and materials flow, has already been pushed beyond simple recession in some places, like Brazil, into defining a new disastrous economic [...]
While some are shocked that China may have “used” a huge amount of “reserves” in November, that is only because so many myths and anachronisms continue to abound in the mainstream and beyond. Any conversation about forex in the context of central banks and national government agencies is one that still views money from a traditional standpoint – as if [...]
Chinese stocks “unexpectedly” plunged last week in a fit of stormed selling that reminded of August rather than the placidity that has been claimed of China since. By mainstream account, China has fixed its bout of “selling UST” and “outflows” while also providing two double doses of “stimulus.” The PBOC had even taken to a higher fix in the middle [...]
Very quietly, the PBOC has been fixing its middle exchange rate against the dollar higher and higher (in dollar terms). Today’s reference rate was 6.3895, up from 6.378 a week ago, with the CNY exchange coming close to 6.40 again for the first time since the disastrous period in late September. Unlike August, there has not been the flood of [...]
Since October 15, gold, yen and Swiss francs have all been pummeled by what increasingly looks like a “dollar” repeat from the start of Q3. It is difficult to suggest whether there is any shift in safe haven bid in all three, but I would guess, as with Q3, it may not have mattered as the “dollar” function globally has [...]
The overnight rate in offshore renminbi liquidity surged over 4% today, the fifth such notable heave in this half of 2015. The rate had been under 2% for the six trading days before and including Friday, but overnight CNH HIBOR jumped from 1.7325% to 4.4525% over the weekend. The one-week maturity similarly spiked, moving from 2.796% at the end of [...]
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