Korea – and now the hit from auto tariffs

Pulled by the policies of previous US administrations and pushed by rising China competition in EM, Korea has focused more on the US market. As a result, US tariffs will hurt more than they would have a few years ago, and with domestic demand weak, there's not much else to support the local economy.
China – profits subdued, especially in heavy industry

Profits rebounded YoY in Jan-Feb, but in level terms remain subdued. That overall picture, however, masks big sectoral differences. Aggregate profits in heavy industry have fallen, and are no higher than in 2013. Earnings in machinery and electronics are more stable.
Japan – Services PPI inflation slower, at least until FY25

Sequential momentum in services PPI has eased in recent moths. However, the data have been volatile since covid, and in 2023 and 2024 there was a big re-acceleration at the beginning of the new fiscal year. Given continued wage growth, a rebound seems likely in April 2025 too.
Korea – no consumer stagflation

Consumer confidence fell back again in March, and remains well below the long-term average. However, general inflation expectations were stable, and while house price expectations ticked up, the change isn't enough to suggest a big acceleration in the real estate market.
Taiwan – unemployment rate stable at 3.4%

There's really not much change happening in Taiwan's labour market. But right now, that's what makes it interesting. Taiwan's unemployment rate is holding at lows not seen in 20 years. That in turn forms the backdrop for wage and core CPI rises which are the highest in 20 years.
Japan – PMI shows continued inflation pressure

Today's flash shows no change from recent themes: manufacturing is weak, services rather volatile, and inflation pressure everywhere is holding up, with manufacturing prices "comfortably above their long-run trend levels", and input costs in services "increasing at the fastest pace in 25 months".
Japan – manufacturing under pressure, services holding up

The standout feature of the Tankan Reuters remains the unusual strength of services relative to manufacturing. Today's march survey shows that this gap isn't expected to close in the next few months, and is one reason for the higher rate of inflation that Japan is experiencing.
Taiwan – wage growth up to 2.5%

The slow but steady pick-up in wage inflation is continuing. The trend is now up to 2.5%, the highest in 20 years. The lift is being led by manufacturing, where wage inflation is nearer 4%. These trends will keep a floor under both CPI inflation, and interest rates.
Korea – private sector employment still weak

The reversal of December's fall in jobs continued in February, but the rise is still being driven by employment in the public sector, and of more elderly workers. In line with very poor business sentiment, private sector employment is continuing to weaken.
Japan – PPI and accumulated price pressure

February's 4% YoY PPI sustains the break with import prices. In level terms, the break is more understandable: import prices usually rise more than PPI, then correct with global recession or JPY strength. As yet, they aren't happening, increasing pressure for PPI to rise.
Taiwan – exports catch up with TSMC

The surge in exports this year isn't all front-loading and Chinese New Year. Through 2024, Taiwan's export data had been looking light relative to TSMC's sales. That gap has now been closed, meaning strong performance for TSMC can once again be thought of as implying macro strength for Taiwan.
Taiwan – exports strong again in February

There is funniness in the data because of the holiday effect and likely tariff front-loading. But still, the surges in some of the flows are striking: server and semi sales, exports and the trade surplus with the US, capital goods imports. No sign at all of the sluggishness seen in the Korean data.
Japan – consumption off to a bad start in 2025

The BOJ's proxy for consumption dropped in January to the lowest since 2022. The population is declining, but the January data don't look much better, even in per capita terms. One reason is inflation, which continues to erode household incomes.
Taiwan – inflation expectations rising again

The rebound in price expectations in Taiwan's consumer confidence survey is starting to look interesting. It isn't just Chinese New Year, with the rise beginning in October last year. Certainly not grounds for the CBC to be cutting rates. Perhaps a reason to hike?
Japan – SPPI inflation peaking?

In YoY terms, the trend in services PPI inflation is still up, but sequentially it is starting to look like it has peaked at a bit above 2%. There might get another boost from a strong shunto, but 2% pipeline inflation looks light for getting sustainable CPI of the same rate.
Taiwan – another sign of shifting supply chains

Data today show Taiwan's export orders dipped in January, but that was likely because of the Lunar New Year. Our broader leading indicator shows export growth remaining around 10% YoY in the next few months. More interesting in today's data is the continued fall in the overseas production ratio.
Korea – confidence up, prices down

Consumer confidence rose again in February but remains well below the LT average; moreover, the improvement is only being among younger people. At the same time, CPI and property price expectations softened. There will be more news tomorrow with business sentiment.
China – less property price deflation, but only just

Deflation eased in January, but only slightly. That's no surprise, given mortgage lending also remained weak last month. The sluggishness is persisting despite low rates, and the failure of rate cuts to revive the quintessentially rate sensitive sector remains a standout feature of this cycle.
Japan – solid services Tankan

Services sector sentiment in the Reuters Tankan remained elevated in today's February survey. Manufacturing is much weaker, and that remains something to be watching given the extra downside risk from tariffs. But in terms of Japan's cycle, Q1 is likely to be another decent quarter.
Korea – household deleveraging

Today's Q424 data show a continuation of the pick-up in household lending from the trough of early 2023. But at 2.4% saar compared with 8% before 2020, the rebound is mild, and slower than GDP growth. For an economy where most indicators have been deteriorating, that's one bit of good news.
Taiwan – upturn in wage growth holding

Like Japan, Taiwan had years of slowing wage and price inflation. And so, similarly with Japan, the turn in wage growth since the financial crisis is as much structural as cyclical. There's no sign of price inflation becoming problematic, but this wage picture suggests it isn't going back to zero.
China – real economy rates down again

Today's PBC data show another steep fall in mortgage interest rates in Q4. Rates are still 3%, so can go lower still. However, before 2020, real estate would be booming by now. That there's little reaction this time shows the problems in the real estate market won't be solved by rate cuts alone.
Japan – not simply import prices

Import price inflation did rise in January, but PPI inflation was much higher, and the relationship between the two has clearly weakened. One driver is the cutting back of gasoline price subsidies, a policy that had held back PPI even as import prices surged in 2021-22.