Paul Cavey

Japan – consumption at all-time high

China – services output up, but not much else

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Korea – softer private sector employment

The headlines don't show much change in the labour market in October, with the unemployment rate still comfortably below 3%. But while employment overall was stable, that was because of government jobs. Employment in the private sector fell again and is now the lowest since July 2023.

Region – consequences of reorienting to the US

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Taiwan – pick-up in wage growth is holding

The post-2020 rise in wage growth is holding in manufacturing. In services, it is less obvious, but for the economy overall, the trend in wage growth is still comfortably above 2% YoY, whereas in the 15 years from 2003 it was closer to 1%. This rise, in turn, should raise the floor for inflation.

Japan – BOJ still constructive, despite modestly softer data

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China – no change in monetary trends

Including CGBs, the credit impulse is weak, but not terrible, and there's been a tick-up in bank lending and mortgages since August. However, there's nothing to suggest any real momentum in the credit cycle. At the same time, the deflationary move into time deposits continues.

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Korea – more signs of export weakness

Export growth in the first ten days of November fell to zero. And while the small number of days make this data set volatile, it comes after weakness in broader data for October, both full-month trade, and the PMI. The weakness in exports is a big deal for the BOK when domestic demand is also soft.

Last week, next week

China – what have we learnt?

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China – still in deflation

There might be some signs of better sentiment feeding into prices, but they aren't strong. Core sequential CPI inflation did get back to zero in October, but the 3mma remains negative. Despite the jump in PMI input prices last month, PPI also continues to fall.

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Japan – consumption moderates through Q3

Today's release from the BOJ of consumption activity through September is so-so, with a further moderation from the pick-up seen in June and July. As such, it isn't suggesting a repeat of the pick-up in household consumption that boosted Q2 GDP.

China – the consumption challenge

Last week, next week

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Taiwan – services driving growth

I thought the drop in the mfg PMIs in October might have been noise. But the November data show it is more than that, remaining weak in both Taiwan and Korea. Korea's exports today fell too. That makes the domestic cycle more important, and in Taiwan, that looks more resilient than Korea.

Japan – BOJ gets back to labour and wages

Region – consumption is weak, but not where you think

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Korea – export downturn

More evidence today that the export cycle has at least peaked, with a sharp slowdown in shipments in October, and another weak PMI. Equity market performance points to there being worse ahead.

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Taiwan – still leading pack

While consumption and the leading indicator have warned of cycle moderation, today's data show GDP growth ticked up QoQ in Q3, led by capex. With TSMC still bullish, Taiwan continues to have one of the strongest cycles, making it unlikely the central bank follows the global trend of rate cuts.

Japan – no surprises from the BOJ

China – PMIs: still a lot to do

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China – employment still very weak

We'll find out more with tomorrow's official PMIs, but while the CKGSB survey for October does show an uptick in overall sentiment, the measure for employment remains very weak. With profits terrible in September, it is clear policy needs to do a lot to turn the cycle around.

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Japan – high inflation not killing consumer confidence

Headline consumer confidence ticked down in October, led by pensioners. But the overall survey continues to send a constructive message for the BOJ. That's because consumer confidence remains relatively firm, even as inflation expectations show no sign of receding.

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Japan – supply constrains labour demand

UE ticked down in September as the part rate fell. Employment hardly changed at all. There probably isn't much room for changes on the demand-side, as demographic constraints on supply become more binding. A negative shock will show up as rising UE, but firm demand will materialise as higher wages.

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Taiwan – inflation expectations up, consumer confidence down

Shifts in consumer confidence mirror almost exactly changes in inflation expectations. Given that, it is no surprise with data today showing inflation expectations ticking up, so consumer confidence edged down. The details show consumers happy with the economy, but less confident about employment.