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China Views: Household Debt No Longer a Growth Stimulus 

Household debt has fueled China's housing, consumption, and economic growth. Households' large financial and housing assets mitigate the risks of rising leverage. However, household leverage is no longer low relative to income, and can no longer be used to stimulate economic growth. 

Weekly Insight: Upping the ante

Precautionary Fed cuts tend to support the U.S. stock market, but have little lasting effect on the USD; A return to easier global financial conditions—if sustained—would reignite concern about rising EM debt levels; Foreign portfolio investment in Chinese equities rose sharply in 2018 and Q1 2019; plenty more room for growth…but international investors in Chinese A-shares still have concerns about restrictions on foreign ownership, high volatility and lack of liquidity  

GCC: Monetary Easing Speeds the Pace of Recovery

The GCC countries followed the Fed and cut their key policy rates, given their pegged exchange rates. Lower interest rates will encourage borrowing and stimulate non-oil growth, which has been weak in recent years. We expect non-oil growth to pick up from 2.1% in 2018 to 2.8% in 2019. 
 

Joint Trades Response to FSB Discussion Paper on Solvent Wind-down

Today the IIF, together with GFMA, and ISDA, submitted a joint response to the Financial Stability Board’s (FSB) discussion paper on the topic of Solvent Wind-down (SWD) of derivatives and trading portfolios.

IIF/GFMA Response to FSB Discussion Paper on Resolution-related Disclosure

The Institute of International Finance (IIF) and the Global Financial Markets Association (GFMA) today submitted a joint response to the Financial Stability Board’s (FSB) discussion paper on the topic of Public Disclosures on Resolution Planning and Resolvability.

IIF Capital Flows Tracker: Modest Inflows

Portfolio flows to Emerging Markets were $24.3 bn in July. Equity and debt flows were $1.2 bn and $23.1 bn, respectively. While China equities att...

Global Macro Views: Is the Dollar Overvalued? (Part 1)

Currency tensions among advanced countries are on the rise, driven by the perception that the US Dollar could be overvalued. We now use our currency valuation framework to examine US Dollar valuation, and look today at the size and composition of the US current account. The US current account deficit is almost entirely (80%) with China. Dollar overvaluation, if it exists, is therefore mostly versus EM Asia.

IIF feedback - GLEIF Paper: Incorporating Banks into Global LEI System 2.0

Today the Institute of International Finance (IIF) submitted a response to the Global Legal Entity Identifier Foundation (GLEIF) on their preliminary draft for discussion on the Global LEI System Concept Paper: Incorporating Banks into the Global LEI System 2.0. 

GRU Podcast: The Importance of Addressing Financial Market Fragmentation

Debra Stone, Managing Director and Head of Corporate Regulatory Affairs at JPMorgan Chase and Wilson Ervin, Vice Chairman in the Group Executive Offic...

ASEAN Economic Views: Vietnam -- Navigating US-China Trade Tensions

Vietnam has further integrated into regional supply chains. It has benefited from US trade diversion away from China, and production reallocation and investment by Chinese firms. The key risk is the US changing its policy stance towards Vietnam.

 

 

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