4 July 2025 China+ Monitor Hong Kong dollar peg here to stay, despite talk of its demise

• The HKMA intervened again on Wednesday to defend the currency peg, which has been in place since 1983.
• The LERS is a double-edged sword: Hong Kong loses monetary policy freedom but gains stability.
• Any talk of re-pegging the HKD is premature; China and HKSAR are not yet an Optimal Currency Area.

CHINA+ DATA WRAP 1 July 2025: China's Caixin manufacturing PMI also rises

China's Caixin PMI, Korea's PMI and Japan's Tankan point to manufacturers' measured relief at easing trade tensions

2 July 2025 China+ Monitor Both China's manufacturing PMI rises led by output; deflation lingers

• The Caixin PMI rebounded more strongly than the official manufacturing index in June…
• …Deflation pressures are festering, however, likely forcing regulatory curbs on excessive competition.
• Korea’s manufacturing PMI is starting to rise from its sickbed, now the election has reduced political risk.

1 July 2025 China+ Monitor PBoC signals less urgency for policy support as PMIs improve

• The PBoC on Friday hinted it saw less need for a near- term monetary policy boost than three months ago.
• The June official manufacturing PMI improved, thanks to policy support and an easing in tariff tensions.
• The construction PMI ticked up at last, but it’s too soon to celebrate; the hard data pointed to slowing.

CHINA+ DATA WRAP 30 June 2025: China's official manufacturing PMI rises

China's Official PMIs point to improving manufacturing and construction activity, but weak jobs market

CHINA+ DATA WRAP 27 June 2025: Tokyo inflation cools thanks to energy subsidies

Tokyo inflation cools thanks to energy subsidies restart
China's industrial profits hit by slower investment income and weak demand

30 June 2025 China+ Monitor BoJ to sit tight as stagflation risk rears its ugly head

• The fall in Tokyo inflation in June was largely due to energy subsidies kicking in again.
• The BoJ will probably stay put on interest rates, given sluggish growth and trade risks...
• ...Assuming oil prices are reasonably well behaved; markets appear sanguine about geopolitical risk.

China+ Datanote: Flash Manufacturing PMI, Japan, June

In one line: Japan's manufacturing PMI rebound on stockpiling activity, but domestic demand softens

China+ Datanote: Flash Services PMI, Japan, June

In one line: Japan's services business activity grow faster in June, but slowing input cost increase bode ill for wage growth

China+ Datanote: Preliminary Current Account, China, Q1

In one line: China’s current account balance holds up in Q1, but deterioration likely in Q2.

China+ Datanote: Preliminary GDP, Japan, Q1

In one line: Japan’s GDP shrinks for the first time in a year, reinforcing the BoJ's wait-and-see stance.

China+ Datanote: 20 Day Exports, Korea, June

In one line: Korea's 20-day exports rebound in June on front loading ahead of reprieve expiry

China+ Datanote: National CPI, Japan, May

In one line: Japan's core inflation surprised on the upside, but unlikely to sway BoJ into hiking mode

25 June 2025 China+ Monitor Japan's flash PMIs reveal areas of resilience amid tariff storm

• Japan’s June headline flash manufacturing index was lifted by output, but demand remained subdued.
• Cost pressures are easing only slowly, with global oil prices a key risk.
• The service sector continues to be bolstered by tourism, notably surging Chinese visitor numbers.

June 2025 - China+ Chartbook

• - CHINA’S FLAGGING GROWTH TO PROMPT POLICY TWEAKS
• - BOJ OPTS FOR PRAGMATIC MIDDLE PATH ON BOND-BUYING
• - BOK LIKELY TO EASE, DESPITE CURRENCY WORRY