East Asia Econ

Welcome

Welcome to EAST ASIA ECON, a research service run from Taipei by Paul Cavey, and specializing in the markets and macro of China, Japan, Korea, and Taiwan.

We cover all the major data releases, as well as providing weekly and monthly summaries. We also devote a lot of time to thematic work, aiming to understand development patterns across the region, and to find common investment themes.

The analysis is founded on an on-the-ground knowledge gained from thirty years experience living, travelling and working in the region. We also have a very strong data infrastructure, built by directly accessing official sources, and made available to subscribers via a comprehensive range of interactive charts and a data app.

We don't think you'll find coverage that is as comprehensive and rounded anywhere else. The articles and charts below give a flavor of the work we are doing. There is a lot more on the home pages of the individual economies.

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Korea – continued labour market slack

Korea – continued labour market slack

The labour market remains slack, with employment dropping in June. Wage growth is also declining, and other data released today show import prices dropping 6% in June. This all suggests inflation will remain constrained, giving room for the BOK to continue to cut rates.

3 min read

Japan – three scenarios for the JPY

Japan – three scenarios for the JPY

My latest video, discussing the JPY outlook in the context of this year's two shocks: tariffs, obviously, but also the rebound in inflation that caused a new sharp fall in consumer confidence. The risk from US policy is still growing, but, importantly, the rebound in prices is losing momentum.

1 min read

China – nominal momentum still weak

China – nominal momentum still weak

Two things stand out in today's big macro release. First, more signs of property bottoming. But there's no indication of a pick-up, which matters given the second takeaway: the weakness of nominal GDP. On my numbers, that grew just 2.4% QoQ annualised, with the fall in the deflator accelerating.

2 min read

China – property prices weaker again

China – property prices weaker again

Property price deflation intensified in June, albeit only mildly. Leading indicators suggest there shouldn't be a new step-down, but only interest rates point to real upside – and interest rates stopped being a reliable lead for the property market some time ago.

1 min read

China – not just government boosting the credit impulse

China – not just government boosting the credit impulse

Continuing recent trends, credit and money data were stronger in June. That helps put a floor under the cycle. The details were softer, with credit growth dependent on government borrowing and mortgage lending still slow. But there are some signs of an upturn in lending to the non-state sector.

2 min read

China – exports up again

China – exports up again

There aren't signs – yet – of China's export juggernaut hitting a wall. The big fall in US exports eased in June, allowing overall exports to continue to creep up, reaching a new post-2022 high. Imports, meanwhile, continue to flat-line, so the trade surplus remains large.

1 min read

Korea – BOK still more worried about growth

Korea – BOK still more worried about growth

Given the rise in house prices, that the BOK didn't cut rates today wasn't a surprise. However, the bank sounded much more confident than I'd expected that the rebound in house prices would be temporary. So, this really is just a pause, and the bank made no change in its "rate cut stance"

2 min read

Japan – goods prices starting to reverse

Japan – goods prices starting to reverse

Data today show more feed through into PPI from the easing of import prices. Weekly rice prices have also dropped again. These trends lower goods price inflation, but will boost household spending power. At the same time, the sharp fall in auto export prices shows the negative impact of tariffs.

4 min read

China – deepening deflation

China – deepening deflation

I am away from my desk, so for now, just a few charts on the CPI/PPI release. Deflation is deepening, which for PPI is broad-based. Core CPI is more stable, but that's partly due to a rise in "other" prices. Headline CPI is lower on food prices, which have started dropping again.

1 min read

Taiwan – madly strong exports, TWD reducing inflation

Taiwan – madly strong exports, TWD reducing inflation

Overall exports, and the trade surplus with the US, continued to surge in June. That Taiwan nonetheless wasn't the recipient of a Trump letter may be because of the sharp rise in the TWD. Other data today show that helping to push down inflation, opening up space for interest rate cuts.

2 min read

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