Asian Currencies Steady as Markets Await U.S. Inflation Data 
Gold Price Hits Two-Month High as Investors Await US Inflation Data 
US Yen Intervention Unlikely to Deliver Lasting Recovery, Yardeni Says 
Yen Stabilizes After Intervention Slide as Australian Dollar Hits Eight-Week High 
China Holds Loan Prime Rates Steady for 14th Month as Economic Recovery Remains Uneven 
South Korean Won Leads Asian FX Losses as Dollar Rises 
Eurozone Bond Yields Fall as Oil Slump Eases Inflation Fears Ahead of Central Bank Meetings 
BOJ Minutes Signal More Rate Hikes as Inflation Risks Grow 
Japan Economy Minister Downplays Inflation Risks Despite BOJ Warning 
Australia Inflation Cools as Core CPI Misses Forecasts, Easing RBA Rate Hike Pressure 
PBoC adviser Huang Yiping said over the weekend that China’s deleveraging has not made any significant progress, which implies that China still relies on credit-fuelled growth model, posing a long-term risk to China’s economy.
He mentioned that the household leverage ratio has picked up sharply on property rally. Clearly, while the surge of property sales helps reduce the unsold inventories, the increase in household debt (due to mortgage financing) could bring about new risks to the economy.
In the meantime, the State-owned Enterprises (SOEs) are still leveraging up, due to implicit guarantee from the governments. China has launched a 350 billion yuan ($52.5 billion) restructuring fund as the government pushes ‘supply-side’ reforms. The Chinese govt has created the fund to support state firms going through hard times. The China State-owned Enterprises Restructuring Fund will be managed by the State-Owned Assets Supervision and Administration Commission (SASAC).
“This fund aims to facilitate the destocking and deleveraging process,” said Zhou Hao, senior emerging markets economist at Commerzbank.
China has made reform of state enterprises, many suffering from surplus production capacity, a nationwide priority as economic growth slows. Reforms include mergers of inefficient state enterprises and laying off workers in struggling sectors such as coal and steel.
