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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
CHINA
- In the past few months, we have seen that despite the sharp increase in inflationary pressures, China long-term bond yields have been constantly testing new lows as investors have been more concerned about the rising uncertainty over the Delta variant.
- The chart below shows the strong divergence between China PPI inflation and the 10Y yield since the start of the year.
- As a reminder, we use PPI for China instead of CPI inflation as it has had a stronger relationship with the 10Y yield over time.
Source: Bloomberg/MNI
- While we have seen that the sharp contraction in Chinese 'liquidity' since the last quarter of 2020 has been weighing on both domestic and international asset prices, it has also acted as a strong leading indicator (9M Lead) of Chinese inflation in the past 15 years.
- The chart below shows that inflationary pressures are now expected to ease significantly in the coming months.
Source: Bloomberg/MNI
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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