Global markets are celebrating US tax reform. Asian stocks followed the record session on Wall Street. This bull market keeps running past forecasts, and profit-taking to lock in a solid year is not happening.
The World Bank increased its forecast for China’s economic growth in 2017 to 6.8% up from 6.7% in October. In 2018 China is likely to outpace consensus forecast. Our view of China and its RMB currency have brightened. The Bank of China’s 5-basis-point hike in front-end reverse repo and 1-year medium-term lending facility rates was less about managing immediate threats and more about signalling a tightening bias across monetary, regulatory and liquidity policies.
By Peter Rosenstreich