Societe Generale: No Major Changes to China PMI

The transcript discusses the market outlook for the RMB and USD, highlighting the impact of dollar weakness and euro strength. It examines inflationary trends and their effect on CPI, noting a potential rise in consumer demand. The discussion also covers currency strength, policy implications, and the tolerance for yuan appreciation. Finally, it addresses the risks of asset bubbles and economic concerns, including the deleveraging campaign and systemic risks in China.

What is the primary factor driving the expected appreciation of the RMB against the USD?

• US interest rate hikes

• Weakness of the dollar

• Strength of the euro

• China's economic growth

How strong is the pass-through from PPI to CPI in China according to historical data?

• Very strong

• Moderate

• Non-existent

• Weak

What could make policymakers more comfortable about normalizing monetary policy in China?

• Rise in export demand

• Increase in manufacturing output

• Decrease in unemployment

• Improvement in core CPI

What is a potential consequence of a jump in CPI for China's economic recovery?

• Increased foreign investment

• More even recovery

• Detrimental impact

• Accelerated growth

What is a concern for investors regarding China's internal market?

• Rapid technological advancement

• Decreasing foreign reserves

• High inflation rates

• Systemic risks from SOEs

What is the stance of China's policymakers on further RMB appreciation to counter commodity price inflation?

• Indifferent

• Opposed

• Neutral

• Supportive

What is the focus of China's deleveraging campaign?

• Controlling local government debt

• Boosting export growth

• Reducing foreign debt

• Increasing consumer spending