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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
- China total aggregate financing rose slightly more than expected in August, up 2.96tr CNY (vs. 2.8tr CNY), up from revised 1.06tr CNY the previous month.
- However, the annual change in 'liquidity', which we define as the annual change in China Total Social Financing (TSF) 12M sum, continues to fall.
- The chart below shows that China liquidity has been contracting sharply in the past 10 months, down from other 10tr CNY in October 2020 to -3.3tr CNY in August, weighing on both domestic and international asset prices.
Source: Bloomberg/MNI
- A fall in Chinese liquidity has generally been associated with a rise in risk aversion with investors seeking for 'safe' assets such as the US Treasuries or the USD.
- The chart below shows how the 6M change in China TSF has strongly lead (8M) the 6M change in US 10Y yield.
- Are long-term bond yields expected to reach new lows 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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