East Asia Econ

Region – three themes in auto

China's auto export surge has been less painful for Asia than for the EU. Japan's domestic market is more protected, and Korean exporters have little dependence on the China market. In third markets, exports have also held up, with tentative signs that China's exports are creating new demand.

Paul Cavey

Jun 5, 2026 • 4 min read

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Korea – the all-weather weakness of the KRW

KRW weakness was blamed on USD strength, then CNY weakness, then JPY weakness. Flows have gone from NPS, to domestic retail, to foreigner institutional. These rationalisations feel a bit like moving the goalposts. But weak KRW does have implications, one likely being a more hawkish BOK.

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East Asia Today

An update on price trends. First, some charts on inflation pressure resulting from the Middle East conflict. Second, a review of real estate prices, which aren't as hot as equities, but are rising quickly in Tokyo and Seoul, and starting to rebound in Taipei.

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East Asia Today

The highlight today was the BOJ governor's speech, which I thought was about as hawkish as it could be. In China, while the official services PMI last month was weak, the RatingDog/S&P version was strong. Also in China, PBC liquidity withdrawals suggest May was another strong month for fx inflows.