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Tag Archives: PBoC

What’s In The Same Number? China’s Part In The (euro)Dollar Story

There’s one part of the dollar story I’ve not yet touched on recently. We’ve already heard, too much, about how the Fed’s killing the dollar, or at least is aiming to with all its immense money printing fire power. While it’s the euro which has demanded so much from DXY that it almost seems plausible (to a few) this time, what’s the real big one still lurking out there have to say about all this?CNY.According to the People’s Bank of China (PBOC), the balance of foreign assets reported on...

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More To Being De-dollared

It’s understandable to an extent. Central banks are omnipotent, central bankers therefore the nearest human equivalent of gods. That’s what we’re all taught, so if something happens somewhere to some market then we’re left to believe it was because one of the gods wanted it that way.Taking this globally, the Fed made a bunch of money in the aftermath of GFC1, therefore there’s no other way to account for how China has behaved other than to assign all activity to the PBOC. Even better than...

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How Do You Say (Way) Off-balance Sheet In Chinese?

Where central banks are concerned, it’s not conspiracy theory so much as the term “off-balance sheet.” There’s a reason Enron kicked off that mass-migration into the footnotes. For monetary officials, there’s the choice to be like Montagu Norman and what he thought of good practice at central banks. Silence.For years, the Chinese have tried it the other way. Big Mama typically left huge muddy footprints wherever its clumsy feet might land. It certainly was that way back in 2015 when Euro$...

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Markets Limp into the Weekend

Overview:  The reversal in US equities yesterday set the stage for today's losses.  All the Asia Pacific bourses fell today but Australia.  For the week, the regional index is off more than 2%.  Europe's Dow Jones Stoxx 600 was flat for the week coming into today's sessions.  It is off around 0.5% in late morning activity.  US shares are firmer, while the S&P 500 is 2.7% through yesterday.  It fell by about 3% last week.  Core bond yields are a little lower, and after a rocky start,...

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What Do China’s LPR Cut & Oil Chaos Share In Common?

For the second time this year, the PBOC has today affirmed Chinese banks are offering a lower benchmark loan rate. The Loan Prime Rate was reformed last August just in time for the monetary authorities in China to make it seem like they are being removed from the decisions. And in time for rate cuts to begin, too. What is the LPR? It is, supposedly, the weighted average rate (after throwing out the highest and lowest) at which eighteen of China’s designated banks will lend to their best...

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What’s *Really* Going On In China?

Questioning the veracity of Chinese estimates (for anything) has always been something of an amateur sport. For a stat like real GDP, everyone “knows” that it is managed. In a complex world where an economic system for a billion and a half is incomprehensibly unpredictable, there’s really no other way to always hit your government’s mark (unless the Chinese are using the same accountants and corporate managers who likewise manage to “beat” their quarterly EPS by $0.01 every time).The world...

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China’s First Virus-Filled Economic Data May Not Be All That Helpful

There were only two possibilities and both related to their release. Either the Communist Chinese government was going to delay them, or would just say, screw it, everyone knows they’re going to be bad so let ‘em fly. There weren’t any questions about the data itself. Sure enough, the first glimpse at China’s economy in its full virus effects was one beyond ugly. Both the manufacturing and non-manufacturing indices plummeted. And the word “plummeted” is understated here. In fact, they went...

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Zombie Insurance, Or Not

It’s another example of the difficulties in trying to evaluate and analyze non-economic factors. China’s virus outbreak is a nightmare for those unfortunately living through it, and Chinese officials aren’t doing themselves any favors. Trust is a sketchy enough concept. The WHO today says there is no pandemic, which, as Erik Townsend of MacroVoices points out, immediately puts this announcement at odds with the official WHO definition of one. Director-General Dr. Tedros Adhanom Ghebreyesus...

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The TIC of CNY and China’s 2020 Risks

What’s going on in China? It’s a question that is on everyone’s mind. While most attention is focused on the unfolding human tragedy of the COVID-19 pandemic, the potential for it to be compounded by any economic fallout makes for even more urgency. The sad truth is that China was in rough shape heading into the coronavirus. How rough, though? It can make quite the difference. Sticking with the virology theme, a relatively healthy body is better equipped and therefore stands a better chance...

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PBOC’s Got A Lot To Juggle

While China’s coronavirus outbreak dominates Western media attention, the Chinese economy has been off for its Golden Week New Year celebrations. Unfortunate timing, to say the least. While global markets have been digesting the latest developments, domestic markets in China have been closed. Nobody really knows how they will reopen on Monday. As a consequence, the People’s Bank of China has asked for calm. Standard practice facing a crisis, the central bank has already preannounced that it...

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