China is making good on its promise of opening up its onshore markets to foreign investors, which only own about 2% of the country’s domestic bonds. With broad index inclusion on the horizon and the introduction of new rules aimed at easing investor access to the market paying off, analysts are turning their attention to concerns over monetary tightening and slower than anticipated growth for 2017.
India’s efforts to curtail the shadow economy and go cashless, coupled with fresh measures introduced by the country’s securities regulator and contained within the latest government budget, are likely to give a big boost to India’s bond market in 2017 despite a number of headwinds that could continue to challenge emerging markets. The development of a viable secondary market could be within reach.
The real estate sector in China is set to cool off in 2017 after the Chinese government enacted a series of measures to prevent a bubble following skyrocketing housing prices seen over the past two years.
For the first time, the president of China was in attendance at the World Economic Forum Annual Meeting in Davos this month. President Xi Jinping joined a roster of presidents, prime ministers, central bankers, executives and other officials from around the world at this prestigious event, which carried the theme this year of “responsive and responsible leadership.”
As the risk of emerging market capital outflows continues to increases, EM government have become more sensitive to unfavourable reports by international institutions.
With official agencies admitting to US$540bn in capital outflows since June, and independent estimates standing at twice that, clouds are gathering over the Chinese economy as it transitions from supply to demand-driven model. But some analysts remain upbeat about the country’s long-term prospects.
The Trans-Pacific Partnership’s (TPP) future is hanging in the balance. Although most involved will not lose out much if the deal falls through, some will forgo significant economic benefits. The deal will likely be replaced by a Chinese variant, which points to the larger demise of US influence in Asia, and China’s growing political clout rise in the region.
SBM’s acquisition of Kenya’s Fidelity Commercial Bank Ltd. shows there is plenty of interest among foreign lenders in Kenyan equity, but the symbolic one dollar price indicates that smaller entities are still under threat.
China is soon to list which state-owned enterprises will undergo restructuring as part of the country’s ongoing reform plans. Although the plans are designed to increase the SOEs’ competitiveness against their foreign counterparts and free up capital to other parts of the economy, implementation could prove harder to see through, with consequences of the late 1990s state-sector reforms still fresh in the minds of many.
24 Nov 2016
Copper has been one of the top-performers in commodities markets this month. While investors agree its value has overshot, they still expect to see demand strengthening relative to supply in the next five years.
- Malaysian NDF Ban Reinforcement Puts Investors on Back-Foot
- Bonds Rally despite India’s “Inconvenient” Currency Ban
- Rising Capital Outflows in China Threaten Snowball Effect
- Indian Banks to Issue Masala Bonds Despite Pressured Finances
- Japan remains on the fence regarding investment in Russia
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