Japan printing presses rhythm trouble controlling inflation in ChinaJapan's Central Bank yesterday (March 16) to provide short-term financial market a total of 5 trillion yen of emergency funds. A 3-day, Japan to inject liquidity into the market by the Government already totals 31 trillion yen annually. Japan Government printing presses after the earthquake caused excess liquidity becomes the focus of attention.
accept analysts pointed out in an interview with the business daily, stronger yen as overseas investment return in the short term, medium term, massive liquidity will lead to a weaker yen, strong earthquakes would also make China's inflation situation is more complicated, and exports could turn deficits in the short term, China Yuan appreciation during the year or down, raising interest rates is also expected to delay.
short term trend of the market is more difficult to measure
yesterday (March 16) morning, Japan's Central Bank to the market after an emergency delivery 3.5 trillion yesterday noon Japan Central Bank added 1.5 trillion yen into the money markets to placate market jitters, ensuring financial market stability and settlement needs.
If you count the release on Monday of 18 trillion yen, Tuesday's 8 trillion yen, past 3 trading days in Japan to inject liquidity into the market by the Government already totals 31 trillion yen (about 2.5 trillion yuan). And in 2008 in response to the financial crisis, China's 4 trillion of new investment plans were carefully implemented in two years. Japan put huge liquidity, short-term market movements even more puzzling.
worrying is, currently Japan government debt as a percentage of GDP reached 200%, United States Government debt accounted for the highest proportion of GDP does not exceed 100%, Japan Government printing presses after the earthquake caused excess liquidity becomes the focus of attention.
market, under the influence of such factors as investors bought on dips after two consecutive trading days the Nikkei 225 index fell more than 16%, yesterday rebounded to close, the index rose 5.68%, back above 9,000. Spot Gold in London stabilised yesterday rebounded 1405.50, GMT 20:10 US dollars an ounce, up 0.7%. Dollar against the Japanese yen continued to fall, yesterday's lowest at 80.63, dollar index around 76.5 trading throughout the day.
worth noting is that yesterday's Japan as rising risk aversion boosted the bond market. Renowned rating agency Moody's believes that Japan limited possibilities to collapse in the bond market after the earthquake, within 1 year or so in the future, Japan government borrowing will not face major problems.
Moody's also noted that Japan's economy will start recovery in second half of 2011, post-disaster reconstruction start, but Japan may be going through a difficult few months, electricity shortages and concern over the safety of nuclear facilities in the emergence of risk aversion among investors.
Wai Yiu think China Economist for Societe Generale, the current uncertainties remain, but the earthquake will soon drag down Japan GDP growth, but medium-term reconstruction to start driving consumer demand increases, so the 2011 Japan GDP upward revision 2%.
capital returning to stimulate a stronger yen
it is reported that almost 0 interest rates make the yen as an international currency markets for a long time, when a market investors often borrow Yen to invest in market gains; when the market tumbled, investors sold assets back to the safe haven of the yen, Yen strength because of increased demand.
CIC securities analysts pointed out that from post-quake Japan not rise of collapse of the stock market, gold market fell, the decline in the dollar and the yen rising signs of judgment, speculative funds after the earthquake is out of Japan, but Japan's overseas investment also returned for post-disaster reconstruction, both offset by Japan after the earthquake will have a lot of capital inflows, leading to a persistently strong yen.
United States Treasury Secretary Timothy Geithner said publicly at a Senate hearing yesterday and not worry about Japan selling United States Treasury bonds to finance post-disaster reconstruction. Mr Geithner pointed out that Japan is a rich countries with high savings rates, have the ability to address the issue of post-disaster reconstruction financing.
on this, method XING Bank China economists Wai Yiu think, Japan reconstruction sources has tax, and printing money and sold overseas assets three species, Japan is may through Qian two species channel financing, sold overseas assets of possibilities is unlikely to, but worth note of is, Japan is after China of United States bonds of second big overseas holds country, in necessary of when not excluded will selling allies of bonds sets now.
Tsinghua University, Professor Zhang Taowei, "said Japan put in by the Government's massive liquidity is like a time bomb, Yen will weaken in the long run. If you can avoid collapse and to stimulate the real economy growth, the side effects will eventually offset; if you fail to stimulate the real economy, excessive liquidity and inflation, will give Japan cast a shadow over economic recovery. ”
earthquake China's inflation situation more complex
Japan earthquake impact on China's economy, the Industrial Bank (market wire) Lu zhengwei, an economist told the business daily in an interview, said that earthquakes induced by the Japan Electronics and auto companies shut down, tend to lower the domestic price in the past for transportation and electronic products, prices have stopped falling and rebound, so that short-term inflation situation more complicated.
Lu zhengwei believes that Japan earthquake likely will slow the speed of the appreciation of the RMB exchange rate, appreciation of the Yuan against the dollar rate changed from 5~6% to 4~5%. Raise rates again until the second quarter, but March is expected to perform a reserve.
it is reported that the earthquake triggered the world's largest plant shut down and a nuclear leak, total output power of the power station allegedly Japan consumption 10%, Tokyo 30%, Japan dealt a huge blow to the economic recovery, and limit Japan's demand for commodities such as oil.
last Friday (March 11) Japan earthquake news, oil prices plunged. 18:34 Beijing yesterday, United States crude oil futures for April delivery at $ 98.68 a barrel, showing signs of stabilization and rebound.
Lu zhengwei believes that "commodity despite falling short, but limited is expected to fall, crude oil will soon be supported metals commodity prices will be supported in the near future. In General, high commodity prices will not change. ”
but analysts point out that, Japan Quake in the short term lead to reduced demand for crude oil, commodities, crude oil prices fell, help ease imported inflationary pressures in China in the short term.
import and export, Societe Generale analysts pointed out that China and Australia are Japan's main trading partners, the short term Japan's trade surplus to fall sharply, but the medium-term would benefit from Japan's post-disaster reconstruction