Free Trial
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 less than expected in December by 2.37tr CNY (vs. 2.4tr expected), down from revised 2.614tr 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, ticked up slightly from -4.8tr CNY to -3.6tr CNY.
- The top chart below shows that China liquidity could start to pick up in the coming months after contracting sharply in 2021.
- A rise in liquidity (combined with the easing policy measures) could stimulate domestic risky assets, especially equities, which have been trading at distressed levels.
- The bottom chart shows that China liquidity has been an important 'driver' of tech stocks in the past cycle; periods of rising liquidity have been associated with higher tech equities and vice versa.
- For international asset prices, China liquidity tends to act with a 6 to 9 months lag; therefore selling pressure on ‘China-sensitive’ risk-on assets could remain elevated in the near term.
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.
We are facing technical issues, please contact our team.
ok
Your request was sent sucessfully! Our team will contact you soon.
ok