23 Oct 2013
Flash: China news supports USD – BBH
FXstreet.com (London) - Research teams at BBH said the weaker dollar theme that surfaced from the US payrolls data was reversed by a bout of risk aversion overnight, which was largely driven by negative financial news from China.
Key Quotes:
“The current concerns were sparked by press reports that China’s biggest banks tripled the amount of bad loans written off in the first half of the year”.
“The reasoning is, reportedly, to clean up their books for a fresh wave of defaults, therefore mitigating a surge in NPLs”.
“Investors are also cautious ahead of the audit results from the Local Government Financing Vehicles (LGFV) which are supposed to be released soon. On that note, Premier Li has already pre-emptively stated overnight that LGFV are safe and controllable”.
“Lastly, a front page article in the China Securities Journal reported new property curbs may be coming in Q4”.
Key Quotes:
“The current concerns were sparked by press reports that China’s biggest banks tripled the amount of bad loans written off in the first half of the year”.
“The reasoning is, reportedly, to clean up their books for a fresh wave of defaults, therefore mitigating a surge in NPLs”.
“Investors are also cautious ahead of the audit results from the Local Government Financing Vehicles (LGFV) which are supposed to be released soon. On that note, Premier Li has already pre-emptively stated overnight that LGFV are safe and controllable”.
“Lastly, a front page article in the China Securities Journal reported new property curbs may be coming in Q4”.