24 Jun 2022
International Economy
Japan's currency has been weakening and hit a 24-year low at Yen 136.24 per USD (as of June 22, 2022), declining 17.1 percent compared to early 2022. Compared to other major currencies, the Yen saw the steepest depreciation, and has signaled a continued drop throughout the rest of the year. The global upward interest rate trend, plus domestic inflationary pressure, are factors which have adversely affected Japan’s production and consumption. It is expected that Japan’s economy will grow 2.1 percent in 2022. For the remainder of 2022, close attention should be paid to movements of the Yen as well as external factors from the global economy – these could put more pressure on Japan’s economy late this year and more prominently in 2023. ... Read more
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9 Oct 2019
Vietnam’s automotive industry is set to grow substantially over the next 5-7 years and this will likely attract additional investments in its car production. Although Vietnam is far behind other ASEAN member states in many aspects, in particular its car production, KResearch views that its car production capacity will likely increase ahead amid a transition towards electric vehicles if Vietnam accelerates improvements in various aspects. These include economic development, implementation of appropriate policies to support the automotive and auto-parts industry, strengthening lending system of financial institutions, offering all segments of the society greater access to finance and building confidence of prospective buyers towards Vietnamese-made cars. ... Read more
15 Mar 2019
KResearch expects the US Federal Reserve (Fed) to keep the policy rates unchanged at 2.25-2.50 percent during the Federal Open Market Committee (FOMC) meeting on March 19-20, 2019. High external risk, slowing US economic activities and lower US inflation will prompt the Fed to hint at only one rate increase this year. It means that the Fed is likely to take a wait-and-see approach and keep the policy rates unchanged for a longer period until the economic outlook becomes clearer. The Fed is also likely to reduce the balance sheet by USD50 billion per month for a while to maintain the policy space and prepare for possible cyclical economic downturn in the future, even though the US GDP growth this year has surpassed its long-term potential.... Read more
19 Jul 2018
From the beginning of 2018 to July 19, the Yuan weakened by more than 3.5 percent against the US Dollar, representing a new record low of CNY6.73/USD. Factors contributing to a rapid softening of the Yuan over the past few months include heightened risks stemming from the US-China trade war, which have prompted China to switch to more accommodating monetary policy in an effort to ensure economic stability at home and maintain its economic growth. In so doing, China has injected liquidity into its banking system and cut the reserve requirement ratio (RRR) for commercial banks by 1.50 percent this year. Moreover, China has injected additional liquidity into its banking system via medium-term lending facility (MLF) while new Yuan loans grew to CNY1.84 trillion in June, bettering the CNY1.22 trillion reported over the past 12 months. If China sends signals to ease its monetary policy further or its economic performance continues to slow, it is expected that the Yuan will tumble even further and this warrants close monitoring in the future. ... Read more