View: The economics story China doesn’t own
China's economic slowdown has rippled through Asia. Tourists aren't flocking to Thai beaches or Singaporean malls in the numbers anticipated. Factories are struggling, and there are questions about whether Beijing can bankroll public works in the manner to which the neighborhood has become accustomed.
One glaring omission from the list of spillovers: interest-rate cuts.
Despite the country's heft, China's travails aren't translating into easing in its backyard.
The People's Bank of China has been pushing down domestic rates and trimming bank reserve requirements in an effort to free cash for lenders to support the recovery. But in shaping financial conditions, the Federal Reserve still rules. Chair Jerome Powell's press conference Wednesday will get more eyeballs than any speech by PBOC boss Pan Gongsheng.
Rate reductions, once penciled in by economists for late this year and early 2024, now look more distant in South Korea and Indonesia.
In the Philippines, officials insist they are ready to hike again, if needed. In a recent speech, Michele Bullock, the new governor of the Reserve Bank of Australia, pledged to keep up the inflation fight that dominated the final year of Philip Lowe's term.
Bank of Japan Governor Kazuo Ueda seems intent on distancing himself from his predecessor’s ultra-easy stance, even if his goal is to make money a bit less cheap rather than expensive. Sure, they worry about China — just not so much that they are ready to move too far from the Fed.
By and large, monetary authorities have adopted a version of the higher-for-longer mantra espoused by US policymakers.
That means most, if not all, of the tightening is done. But don’t even think about a pivot to something looser. Inflation has retreated,
. Read more on economictimes.indiatimes.com
