Central Banks

Sumitomo gives India’s top lender a welcome fillip

12 May 2025

State Bank of India and peers are selling 20% of Yes Bank to the Japanese group for $1.6 bln – almost tripling their money on this chunk of their investment in the 2020 bailout. It’s well-timed for SBI as it plans a share sale and other measures to bolster its own capital.

Taiwan insurers get a stern currency warning

12 May 2025

The local dollar’s strong rally against the greenback will hit earnings at Cathay Life and peers, which have some $760 bln invested abroad. Hedges and reserves soften the blow. But the underlying mismatch of domestic policies funding overseas assets is an enduring risk.

China’s wait-and-see approach exposes policy limit

7 May 2025

The country's top three regulators unveiled rate cuts, liquidity injections and other steps in a rare meeting but held off on major spending. It shows Beijing is biding its time ahead of US trade talks. Yet the reluctance also stems from limited room to expand the fiscal deficit.

Beijing’s firm yuan nudge can cool Asia FX rally

6 May 2025

The central bank is keeping its dollar trading band steady, suggesting President Xi won't throw exporters under the bus. Issues like de-dollarisation fears mean Asian currencies’ rise may not reverse. But China's approach can help anchor the region during Sino-US trade talks.

Trump Fed favorite has policies for different era

30 Apr 2025

Kevin Warsh, the likely next top US central banker, wants the institution to meddle less in government bonds and climate change policy. Focusing on its inflation-fighting mission makes sense in theory. But it risks destabilizing markets and inviting more political interference.

Gold shines brighter as red, white and blue dull

24 Apr 2025

The precious metal’s price has surged 24% to $3,300 an ounce this year as foreign investors and central banks take cover amid Donald Trump’s trade war. There’s no good proxy for zero-risk US debt, but yellow bars will be a trendy hedge if the dollar’s reserve status keeps fading.

Why the US bond selloff could keep spiralling

9 Apr 2025

Yields on 30-year government debt spiked to almost 4.9%, from below 4.4% on Friday, as Donald Trump’s trade war roils the world’s key funding market. The squeeze reinforces longer-term fears about the cost of tariffs. Barring a policy U-turn, the selling looks set to continue.

China’s banks head towards new lending woes

1 Apr 2025

The state hopes injecting $72 billion of capital into four big lenders will spark consumer-driven economic growth. But it adds little firepower, and the country’s high savings rate suggests the banks have their work cut out. Doing Beijing’s bidding is already causing stress.

ECB bank snub is good for Orcel, bad for M&A bulls

26 Mar 2025

The supervisor has queried Banco BPM’s use of the ‘Danish Compromise’ in its swoop on fund group Anima. That’s bad for the acquirer. But it’s good for UniCredit CEO Andrea Orcel, who wants to buy BPM – and for those who want M&A to be based on logic, not capital arbitrage.

India’s banks face a new credibility test

12 Mar 2025

Shares in IndusInd, the country's fifth-largest private lender, fell 27% after it reported a derivatives lapse that will hit earnings. Cascading issues from management churn to bad loans seem to set it apart. But the latest mess will inspire heightened scrutiny of its peers too.

ECB fails to get the memo on Europe’s emergency

6 Mar 2025

The European Central Bank cut its key rate to 2.5%, but now looks coy about future monetary loosening. Its fears of the inflationary impact of a tariff war and higher defence spending look overblown. And geopolitical uncertainty calls for firm guidance, not excessive caution.

China’s bank recap exposes lenders’ dilemma

5 Mar 2025

The weakest Big Five lender, $70 bln BoCom, may be the first to get a capital injection from the state. Beijing will want it to spur lending to help drive economic growth. But with more earnings-sapping rate cuts likely, BoCom would be better off keeping any new powder dry.

China’s only plan for Trump is plan for the worst

28 Feb 2025

The US president says he'll apply a new 10% tariff to its rival's exports next week as Beijing's annual policy meetings kick off. Chinese officials are due to set growth and stimulus targets. These will need to be flexible and vague to absorb rapidly escalating external shocks.

Interests partly align behind Hong Kong bourse CEO

26 Feb 2025

One year into Bonnie Chan’s tenure at HKEX a push to streamline listings and tweaks to fees look well-timed as a $450 bln rally whets appetite for China stocks. The exchange remains tied to Chinese tech’s mast but Beijing’s pro-business messaging provides ample tailwinds for now.

US tax weaponisation launches messy European fight

5 Feb 2025

President Trump has begun probes into “discriminatory” tax measures, like France’s 3% Big Tech duty. His retaliation may include hiking levies for foreign firms and wealthy investors in the US. But since Europe is unlikely to cave in on this issue, the crossfire will be intense.

India’s tax cuts grasp at a fleeting growth fix

3 Feb 2025

By hiking the income-tax exemption threshold, Narendra Modi’s government hopes the middle class will go out and spend. But that leaves the state relying on 1% of the working age population to help pay its bills. It throws the urgency to tackle stagnant wages into sharp relief.

Bond bulls put Beijing on the horns of a dilemma

28 Jan 2025

The relentless plunge in yields allows China to issue debt inexpensively to stimulate its $18 trln economy, but it also reinforces expectations of slow GDP growth, a weak yuan and the People’s Republic as a low-interest-rate country. Managing that tension is getting riskier.

Japan rates’ fate rests on Trump-Ishiba bromance

24 Jan 2025

The country's rising inflation and wage growth make the case for more hikes, but US tariffs could change the argument. The prime minister’s first trip to Washington will require ample charm and concrete offers on investment and defence policy to mollify the levy-prone president.

Cracks in India’s consumption story run deep

16 Jan 2025

Wages of its giant workforce are stagnating, dragging down growth in the $4 trln economy. Authorities can cut taxes or ease the flow of credit to stimulate spending. It will, though, cut the financial stability that underpins the emerging market’s moment.

US tariffs may lead ratesetters to fight wrong war

14 Jan 2025

As Donald Trump returns to the White House, his trade policies could push prices up. Fed Chair Jay Powell and Europe’s Christine Lagarde may be tempted to respond with tactics they think helped lower inflation towards 2% in the latest crisis. That could hurt their economies.