China – exports not quite so all-conquering In contrast to the common impression, China's global market share has been falling. Whether this is just a pause after the covid surge or something more permanent will be a big theme in 2024 for China's cycle, the CNY and China's trade relations with ROW.
Korea – exports stronger so far in May On a headline basis, export growth accelerated again in the first ten days of May. That keeps alive the theme of industrial recovery, even if some of the details continue to look more sluggish.
China – mortgage rates still falling fast Data in yesterday's Q1 monetary policy report showed another sharp fall in mortgage rates to well below 4%. But while they worked before, rate cuts in this cycle have shown no sign yet of boosting buyer sentiment.
China – core inflation low but stable Core CPI inflation continues to run at a bit below 1% annualised. That is too low for comfort, though for now doesn't show any sign of taking a new step down into deflation.
Taiwan – wage growth slower in March Cyclically, wage growth has slowed from over 2.5% YoY in 23 to 1.4% now. But the structural rise in manufacturing wage growth is persisting, which will have macro significance if the sector convincingly lifts out of recession.
Japan – households lead sentiment lower There was quite a big fall in the EW survey in April, a warning that recent JPY volatility might be pushing up inflation expectations again.
Japan – another weak consumption indicator While a bit stronger than the beginning of this year, the household survey shows real consumption spending still 2% lower than in 2019.
China – construction up, manufacturing down Another chart that challenges the idea that the structure of China's economy has changed much. Relative to GDP, construction is rebounding, while manufacturing is falling.
Japan – no consumption recovery yet PMIs, CPI, wages, profits....most macro indicators look positive. The one weak spot remains consumption, with little sign of improvement through March.
China – moderate export recovery Underlying trade values show the moderate export recovery that began in mid-23 is continuing, while imports are flat-lining.
Taiwan – export recovery falters in April The nominal export recovery across the region has lost momentum, with Taiwan's April exports fading YoY and MoM.
China – has anything really changed? It is often thought that China is transforming into a mfg-led, services-light economy. Relative growth did slow post-15. However, as a proportion of GDP, the services sector has never been bigger.
Region – perhaps the weak KRW helps as well It seems reasonable to think the cheap JPY is contributing to Japan's tourism boom. But Korea's visitor numbers are also closing in on pre-covid levels. Recovery in Taiwan, by contrast, is lagging.
Taiwan – inflation still firm Headline inflation dropped below 2% YoY in April, and core eased too. But underlying services inflation – a proxy for domestically generated price pressures – remains at almost 3%, a near 30-year high.
China – PPI flat Prices might be drifting down a bit, and there's big product differences (steel weak, copper strong), but high-frequency data don't suggest any real deflation emanating from China's industrial sector.
Japan – "Charge inflation hits a 10-yr high" The PMI shows strong services momentum and prices charged rising "at its steepest since April 2014...reflecting another sharp rise in input costs....which was mostly linked to greater salary payments."
China – PBC balance sheet expansion slows PSL lending, which seemed like it might become a thing for 20204, hasn't: yesterday's April data showed no new lending, so with previous loans maturing, PSL outstanding has fallen back again.
China – solid services growth The S&P PMI shows China's services sector continues to grow at a solid rate. The outlook also remains firm, with new business growing in April by the quickest rate in almost a year.
Japan – weak consumption isn't just wages The market focus in on real wages, but the elderly are even worse off than workers, the result of a policy of deliberately cutting pensions in real terms.
China – the end of PPI deflation There continue to be signs that PPI inflation will turn positive in the next couple of months. That will ease an important source of investor concern.
Japan – consumer confidence holding up Rather than a currency crisis, the importance of the weaker JPY for the macroeconomy is via the purchasing power of consumers. In this respect, April consumer confidence isn't too bad: down a bit, but still well up from the lows.
China – house price expectations still falling The PBC's Q1 urban depositor survey shows the housing market still hasn't bottomed, with price expectations falling to yet another new low in the survey's history.
Taiwan – finally, some manufacturing growth The S&P PMI showed the manufacturing sector grew in April for the first time in two years. But the PMI was still only 50.2. That's not much after such a long recession – and all the excitement about AI.
Korea – underlying inflation at target Headline inflation remains around 3%. But that's because of food and energy. The trimmed mean is now at the BOK's target of 2%.
Korea – export recovery still underwhelming There is an export recovery, but in value terms it still doesn't look so strong, with full-month YoY growth through April struggling to get much above 10% YoY.