Market

30Nov mmBy Brian ThompsonNo Comments
Asia, Market, USA, World

Asia Economic Monthly: Asia’s Trump surprise

Donald Trump has won the US presidential election. Tariffs and tax policy will likely be the focus under Trump 2.0, according to Nomura analysis. The administration may implement 60% tariffs against China, which may come into effect by mid-2025, and baseline tariffs of 10% on most foreign products imported by the US. What Trump 2.0 means for Asia Asia is better prepared this time. Trump’s re-election has less of a shock factor given greater familiarity with his policies. Asia is also more resilient, due to the ongoing trends of US-China decoupling, shifts in global supply chains and lower Asian exports to China. Yet, Trump 2.0 will likely mean more policy uncertainty, which may be a negative for Asia. There could be a larger drag on 2025 GDP growth. Even prior to t...
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Asia’s transition to climate resilience
30Nov mmBy Brian ThompsonNo Comments
Asia, Market

Asia’s transition to climate resilience

Reflecting on the just-concluded COP29 deliberations, it’s clear that Asia’s climate journey is entering a more ambitious phase. Talks at Baku highlighted the region’s essential role in tackling global climate challenges, with conversations ranging from robust carbon markets to ramping up adaptation actions. While negotiations over a new collective quantified goal for global climate finance are casting a dark shadow, the conversations coming out of COP29 underscore the willingness of governments, businesses, and communities across Asia to move from commitments to actionable, region-specific climate solutions. For me, these are the key themes emerging as we look back on 2024. Innovation in the mobility sector: Asia’s mobility sector is rapidly innovating to reduce emissions, with a dist...
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Five reasons why India’s GDP might surpass Japan’s to become the fourth biggest
29Nov mmBy Brian ThompsonNo Comments
Asia, Market

Five reasons why India’s GDP might surpass Japan’s to become the fourth biggest

India’s economy expanded by 5.4 per cent in the July-September quarter of the ongoing fiscal year, marking a slowdown from the previous quarter’s 6.7 per cent growth. Despite this deceleration, India maintains its position as the fastest-growing major economy globally. It’s this kind of sustained growth that had led to expectations that India will surpass Japan to become the world’s fourth-largest economy. The International Monetary Fund (IMF) projects that this will happen as early as 2025. The international body estimates Indian economy’s size would be $4.34 trillion, compared to Japan’s $4.31 trillion. Here’s a look at five factors that could be responsible for such an achievement: Attraction of global investments: India’s financial markets have become increasi...
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Before the long weekend, the dollar declines due to a dump of economic data.
29Nov mmBy Michael SmithNo Comments
Market, USA, World

Before the long weekend, the dollar declines due to a dump of economic data.

The dollar fell broadly on Wednesday in thin pre-holiday trade, digesting a slew of indicators that underscored U.S. economic resilience while investors assessed the risk that President-elect Donald Trump will start a tariff war no one will win. The decline further unwound the dollar's recent rally. Few traders were interested in building or holding positions before a long Thanksgiving weekend for many of them that dovetails with month end. Markets are closed Thursday and exchanges close early on Friday. Moreover, revised data showing gross domestic product rose at a 2.8% rate in the third quarter, as expected and the same as last month's first estimate, did not much bolster the case for the Federal Reserve to ease again next month, although traders still leaned that way, lifting od...
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According to a survey, Asian steelmakers are failing to transition to renewable energy.
29Nov mmBy Brian ThompsonNo Comments
Asia, Market, World

According to a survey, Asian steelmakers are failing to transition to renewable energy.

Asian steelmakers are among the worst performers at making the switch to renewables, according to a new survey that found many of them are still entirely dependent on fossil fuels for production. Steel production accounts for about 8% of global carbon emissions and about 30% of emissions from industry. A majority of the sector’s emissions are tied to its use of metallurgical coal, which is a key source of heat and carbon needed to turn iron ore into steel. Coal-fired blast furnaces — that melt iron ore and create pig iron — produce 2 metric tons of CO2 for each ton of output. That has put steelmaking in the focus for global climate activists and policymakers, as the world races to make a critical energy transition. But a survey by Sydney-based climate group Action Spea...
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Asia in denial
29Nov mmBy Brian ThompsonNo Comments
Asia, China, Market

Asia in denial

I saw nothing but denial in my recent post-US election tour of Asia, with stops in Hong Kong, Shenzhen, Beijing, and Singapore. Taking a cue from surging global equity markets, Asians are making every effort to wish away problems at home and abroad. Nowhere is this more evident than in China. President Xi Jinping has long stressed his preference for the “good stories of China” (bit.ly/3Z8EI75). Amid the most serious Chinese economic slowdown since the 1970s, government attempts to put a positive spin (bit.ly/3Ozky0R) on the country’s outlook have intensified. An improvement in equity-market sentiment (bit.ly/4fL6ZaO) — by October 8, the CSI 300 was 35% above its low on September 13 — was the first talking point in all my discussions. Never mind that this rebound, which has si...
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Maldives abandons “India-Out” in favor of a financial lifeline
28Nov mmBy Brian ThompsonNo Comments
Asia, Market, World

Maldives abandons “India-Out” in favor of a financial lifeline

The state visit to India last month by Maldives President Mohamed Muizzu involved a visible effort to repair the diplomatic relationship. New Delhi more than welcomed the rapprochement and signed a range of agreements with Male. India-Maldives ties were bumped up to “Comprehensive Economic and Maritime Security Partnership,” with an ambitious vision document attached. Muizzu’s visit starkly contrasted the sentiment that accompanied his rise to power. He took took office last year following a politically charged “India-Out” election campaign. Immediately upon victory, he removed from the country the minimal Indian military presence (in place primarily to assist Male operate Indian defence platforms) and “reviewed” and junked important strategic agreements with I...
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Unrevised US third-quarter GDP growth was 2.8%.
28Nov mmBy Walter ParezNo Comments
Market, USA

Unrevised US third-quarter GDP growth was 2.8%.

The U.S. economy grew at a solid clip in the third quarter, the government confirmed on Wednesday, amid robust consumer spending. Gross domestic product increased at an unrevised 2.8% annualized rate, the Commerce Department's Bureau of Economic Analysis said in its second estimate of third-quarter GDP. Economists polled by Reuters had forecast GDP would be unrevised. Slight downward revisions to consumer spending, government outlays and exports, were offset by upgrades to private inventory accumulation, business investment as well as state and local government spending. The economy grew at a 3.0% pace in the April-June quarter. It is expanding at a pace that is well above what Federal Reserve officials regard as the non-inflationary growth rate of around 1.8%. Consumer spendi...
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Beyond the inner ring of the Communist Party, a small group of well-known economists make up the “brain trust” that shapes economic policy.
28Nov mmBy Walter ParezNo Comments
Asia, China, Market

Beyond the inner ring of the Communist Party, a small group of well-known economists make up the “brain trust” that shapes economic policy.

Who truly has Beijing’s ear when it comes to economic policymaking? As China navigates a period of profound economic challenges, this question has taken on new urgency. While outsiders often perceive China’s economic policies as dictated in a top-down, insulated manner, the reality is more nuanced. Policy-making in Beijing frequently involves regular engagement with trusted experts through roundtables, study sessions, and advisory committees. The voices shaping economic strategy extend beyond the Chinese Communist Party (CCP)’s inner circle to include a select “brain trust” of economists whose ideas inform and influence key decisions. To understand China’s policy direction, it is crucial to identify this brain trust. Our project does just that by analyzing the perspectives of econom...
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A trade crisis is sparked as the US threatens to impose tariffs on Canada and Mexico.
28Nov mmBy Mike TrudellNo Comments
Asia, Market, USA, World

A trade crisis is sparked as the US threatens to impose tariffs on Canada and Mexico.

The United States is threatening a significant shake-up in its trade relations with Canada and Mexico. President-Elect Trump has proposed imposing tariffs of up to 25 per cent on key imports. A Reuters report highlights that it includes crude oil, automobiles, and agricultural goods. This move comes amid escalating disputes over border security and trade imbalances. For Canada, the potential tariffs on crude oil could severely impact the nation’s economy, given that over 80 per cent of its oil exports are destined for the US. Meanwhile, Mexico, which relies heavily on automobile and agricultural exports to its northern neighbour, could face severe economic repercussions. Mexican president Claudia Sheinbaum during a press conference highlighted and I quote “to one tariff will c...
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