East Asia Econ

Last week, next week

Data last week showed Taiwan remaining as one of the world's major beneficiaries of AI adoption. A big question for 2026 is whether Korea joins the party. Other themes are fiscal uncertainty in Japan, and further signs of stabilisation in China's underlying cycle.

Paul Cavey

Nov 9, 2025 • 7 min read

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China – less deflation in Q4

CPI and PPI data for October show another lessening of deflation, and leads point to that trend being sustained through year-end. That is important, and fits with my idea of a bottoming for the underlying cycle. But I am not convinced yet, with services CPI inflation still too low.

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East Asia Today

Today's trade data for October were interesting, being stronger in Taiwan, but weaker in China. Taiwan's trade surplus surged again, but despite the narrowing in China, fx reserves rose in October. Also today, a note delving into an under-explored aspect of China's FAI data.

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Taiwan – trade surplus reaches 30% of GDP

I am running out of superlatives to describe Taiwan's export story in 2025. So I'll let the numbers speak for themselves: today's October data show semi exports have grown 70% this year, pushing the overall trade surplus last month to 30% of GDP, and the bilateral surplus with the US to 20% of GDP