MNI China Daily Summary: Friday, October 25

MNI BRIEF: China's Next NPC Meeting Scheduled For Nov 4 to 8

MNI: PBOC Net Injects CNY184.2 Bln via OMO Friday

MNI: PBOC Sets Yuan Parity Lower At 7.1090 Fri; +2.73% Y/Y

CHINA PBOC CONDUCTS CNY292.6 BLN VIA 7-DAY REVERSE REPOS FRI

CHINA SETS YUAN CENTRAL PARITY AT 7.1090 FRI VS 7.1286

MNI: GERMANY OCT IFO BUSINESS CLIMATE INDEX 86.5

MNI: ECB 1-YEAR CONSUMER INFLATION EXPECTATIONS 2.4%

MNI: FRANCE OCT CONSUMER SENTIMENT 94

CANADA: Politics Week: Trudeau Facing More Internal Dissent And Departures

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ARGENTINA: JP Morgan Sees Scope To Ease Capital Controls By Year-End/Early 2025

ARGENTINA
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  • The IMF noted earlier today that it sees growth in Argentina starting to gradually recover, and the country’s largest private bank, Banco Galicia, also expects loans to surge this year, according to a report on Bloomberg. The Bank’s CEO Fabian Kon says that if the government gets rid of restrictions on the economy over the coming months, including controls on imports, then inflation will fall and credit will increase.
  • JP Morgan also notes that a crowding-in scenario is emerging, with banking credit growing in both local and foreign currencies, which should bolster economic activity. In this context, they say, there is potential to begin easing capital controls by the end of the year or early next year.
  • While the administration is cautious about any risks that could disrupt the downward trend in inflation, JPM believes that the benefits of easing controls will outweigh potential risks. In their view, the gradual release of capital controls could open the door to external market access by the second half of 2025, accelerate growth, and help consolidate inflation convergence to single-digit levels by 2026.
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  • The IMF noted earlier today that it sees growth in Argentina starting to gradually recover, and the country’s largest private bank, Banco Galicia, also expects loans to surge this year, according to a report on Bloomberg. The Bank’s CEO Fabian Kon says that if the government gets rid of restrictions on the economy over the coming months, including controls on imports, then inflation will fall and credit will increase.
  • JP Morgan also notes that a crowding-in scenario is emerging, with banking credit growing in both local and foreign currencies, which should bolster economic activity. In this context, they say, there is potential to begin easing capital controls by the end of the year or early next year.
  • While the administration is cautious about any risks that could disrupt the downward trend in inflation, JPM believes that the benefits of easing controls will outweigh potential risks. In their view, the gradual release of capital controls could open the door to external market access by the second half of 2025, accelerate growth, and help consolidate inflation convergence to single-digit levels by 2026.