Wednesday, 5 November 2014

Asia today and charts today

So where to start?  The continued fall of the Japanese yen...

...or Mr Kuroda's speech where he basically said he would do whatever it takes?

“First, the Bank will do whatever it can to overcome the deflation that has long undermined Japan's economy. Second, it is making a strong and clear commitment to achieve the price stability target as its responsibility. Third, to underpin the commitment, the Bank is carrying out monetary easing in a new phase both in terms of quantity and quality, which is different from past policies”

There was some better news out of Japan today (no not the services PMI which was impacted by a typhoon...apparently) base wages in September were up 0.5 per cent from a year ago and that summer bonus payments grew at the fastest pace in 23 years.  However real wages continued to fall (-2.9% from a year earlier).  The trouble is that a normal looking economy does not have a real/nominal GDP chart that looks like this: 

Nor a bond market so dominated by the Bank of Japan: 

·        HSBC's China services index for October offered a reading of 52.9, down from 53.5 in September and the slowest reading since July.  HSBC survey comment: ‘we still expect further easing measures in the coming months to help offset the downward pressures on the economy’.  Meanwhile in Hong Kong the number came in at a contracting 47.7 and ‘Operating conditions deteriorate at quickest rate in over three years’. An Occupy impact?

A couple of other Asia stories that caught me eye included Moody's Investors Service saying that the outlooks for most Asia Pacific Economic Cooperation (APEC) members' credit ratings are stable, 'reflecting their resilience to economic and financial volatility'. Link here 

Also a fascinating story about one of the few well-balanced economies, namely New Zealand here

Finally a few charts including the continuing plunging commodity index...

...and in another sign of disinflation, the UK BRC noted continued food/non-food disinflationary trends:

Finally, the political map of the US has turned red.  Implications?  Well the US dollar is up (as noted above) and futures are also up...optimism abounds.  The question is sustainability...

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