March 21, 2023 01:29 GMT
SVB Fallout Could Slow Decoupling - Advisor
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The willingness of the U.S. to decouple from China may slow in order to ease inflationary pressures as the collapse of Silicon Valley Bank has restrained the Federal Reserve’s ability to raise interest rates, according to a Yicai.com report citing Liu Yuhui, professor at the Chinese Academy of Social Sciences. Liu said China faced the risk of deflation if domestic demand did not recover sufficiently, therefore macro policy needed to be bolder. China's residential, corporate, and local government balance sheets have declined over the past three years, which will take time to recover, he said.