• In today’s Comment we will take a detour to the Chinese economy, something that we do every now and then. After all, China is the world’s second largest economy. And developments in the Chinese business cycle – credit cycle or policy cycle might be a more apt description – must have effects that spill abroad.
  • Yesterday’s surprise easing by the People’s Bank of China triggered strong moves in CNH, which fell strongly against the greenback. At the same time, Chinese sovereign yields extended their recent declines. And the spread with US Treasuries became more negative:

 

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