China’s retail sales and industrial production picked up pace in August with better-than-expected growth, according to National Bureau of Statistics data released Friday
Retail sales grew by 4.6% in August from a year ago, beating expectations for 3% growth forecast by a Reuters poll. The increase was also faster than the 2.5% year-on-year pace in July. Industrial production grew by 4.5% in August from a year ago, better than the 3.9% forecast and faster than the 3.7% increase reported for July. Fixed asset investment, however, grew by 3.2% year-on-year in August on a year-to-date basis. That missed expectations for a 3.3% increase and was slower than the 3.4% pace reported as of July. The figure was dragged down by a steeper drop in real estate investment, and a slowdown in infrastructure investment. Only manufacturing saw the pace of investment pick up. Statistics bureau spokesperson Fu Linghui said the real estate market was still in a period of “adjustment” and noted declines in sales and investment. Source: CNBC
While China has been offloading US Treasuries for 10+ years, the rate has accelerated
Both Canada and Mexico also now account for a higher % of US imports than China. These stories belong to the "new normal": the East-West divide, reshoring / nearshoring / friendshoring, etc. Source: Tavi Costa, Bloomberg, The Kobeissi Letter
2022 global military budgets hit an all-time high of $2.2 trillion
When you combine the military budgets of the US and China, it surpasses the combined budgets of all other countries in the world! By Genuine Impact / Chris Quinn
After hitting a 16-year low against the U.S. Dollar, China's currency had its biggest gain in almost 3 weeks after the country issued a warning not to bet against its currency
Source: Barchart, FT
Japan's 10-year yield surged this morning to 0.70%, its highest level in almost a decade, following weekend comments by Bank of Japan (boj) Governor Kazuo Ueda
Ueda said the central bank’s lifting of its negative interest rate policy will become an option if wages and prices rise, revealing his thinking during an interview with The Yomiuri Shimbun. Ueda said that “there are various options” including lifting the negative interest rate policy once the central bank is confident that Japan has achieved sustainable price increases accompanied by rising wages. The negative interest rate policy is a pillar of the Bank of Japan’s large-scale monetary easing measures. While an easy monetary policy environment will be maintained for the time being, signs of factors could emerge that would allow a decision to be made by the end of the year, he indicated. This is the first time Ueda has given an exclusive interview to any media organization since taking office in April. Source: The Japan News, Tavi Costa, Bloomberg
India Nifty 50 Index. Big picture, via 5% box size
Source: Mark Ungewitter
Nearshoring / Friendshoring in action... For the 1st time since 2003, the US is importing more from Mexico than from China
Source: BofA, Bloomberg
China Budges in Fight With Bears, Sending Yuan Toward Record Low – Bloomberg
The offshore yuan weakened toward its lowest on record against the dollar, as a cut to the daily reference rate for the managed currency stoked bets China is comfortable with a gradual depreciation. China’s currency declined to about 7.36 per dollar in overseas trading, beyond the psychologically important level of 7.35 and close to the weakest since the creation of the offshore yuan market in 2010. The move came after the People’s Bank of China set its so-called fixing at a two-month low on Friday.
