Chinese Yuan May Be Undervalued -- Market Talk
0328 GMT - The Chinese yuan is undervalued by as much as 25%, Jonas Goltermann, chief markets economist at Capital Economics says in a note. Reducing China's trade surplus to a broadly balanced position would necessarily involve the yuan's significant appreciation, he says. That said, exchange rate adjustment alone wouldn't resolve the imbalance and is unlikely to happen without a major realignment of macroeconomic policies in China and its key trade partners, he adds. The Chinese currency has actually rebounded over the past year or so, in spite of headwinds from higher energy prices and a hawkish Fed. The rebound doesn't appear to reflect the Chinese central bank's support. If anything, the yuan would probably have risen faster if policymakers haven't been slowing its rally down, he says. (jiahui.huang@wsj.com; @ivy_jiahuihuang) 0257 GMT - The Singapore dollar weakens slightly against its U.S. counterpart in the Asian session amid rising Treasury yields that typically enhance the allure of U.S. fixed-income assets and demand for the greenback. Focus now shifts to the minutes of the FOMC's September meeting due later Wednesday, OCBC Group Research strategists say in a report. The
0328 GMT - The Chinese yuan is undervalued by as much as 25%, Jonas Goltermann, chief markets economist at Capital Economics says in a note. Reducing China's trade surplus to a broadly balanced position would necessarily involve the yuan's significant appreciation, he says. That said, exchange rate adjustment alone wouldn't resolve the imbalance and is unlikely to happen without a major realignment of macroeconomic policies in China and its key trade partners, he adds. The Chinese currency has actually rebounded over the past year or so, in spite of headwinds from higher energy prices and a hawkish Fed.
The rebound doesn't appear to reflect the Chinese central bank's support. If anything, the yuan would probably have risen faster if policymakers haven't been slowing its rally down, he says. S. S.
fixed-income assets and demand for the greenback. Focus now shifts to the minutes of the FOMC's September meeting due later Wednesday, OCBC Group Research strategists say in a report. The minutes will be closely watched for clues on the degree of support for further tightening and whether policymakers favour a gradual approach or a faster pace of rate increases, the strategists say. S.
2788. com) 0224 GMT - The Bank of Thailand is still likely to keep monetary policy accommodative, say two members of Goldman Sachs' economics research team in a note. While reduced fuel subsidies could drive up inflation by allowing greater pass-through from global energy prices, the members do not expect the BOT to respond unless inflation becomes more persistent and broad-based. "At this stage, we do not see such evidence," they add.
Hence, GS maintains its expectation that the BOT will keep monetary policy accommodative, leaving the policy rate unchanged at 1% through the remainder of this year. com) 0204 GMT - Malaysia's Budget 2027 is expected to offer policy support to favor domestic manufacturing and strengthen the automotive supply chain, says Affin Hwang IB analyst Afifah Ishak in a note. This should benefit companies with meaningful manufacturing footprints in Malaysia, including selected auto-part suppliers, while companies with limited local value-added activities could face pressure, she says.
The shift could benefit auto assembler Inokom, owned by Sime Darby and Bermaz Auto, if stricter requirements encourage vehicle manufacturers to move from imports to local assembly. Malaysia's automotive supply chain remains concentrated in traditional components, while capabilities in higher-value areas such as EV batteries and electric drivetrains are still at an early stage of development, she notes. Affin Hwang maintains a neutral rating on Malaysia's auto and auto-parts sector. com) 0146 GMT - China's extended Golden Week holiday isn't likely to provide a major boost to consumption recovery, Deutsche Bank analyst Sammi Xu says in a note.
It says domestic travel was subdued, with limited spending. Government estimates show that during the Oct. 3%, respectively. Hotel room rates in major cities were weaker than expected, suggesting a modestly negative read-through for 4Q hotel revenue per available room.
9%, respectively. S. Treasury market. JGBs and Treasurys tend to move in tandem.
"We anticipate that buying will be slightly dominant" today following Tuesday's pause in Treasury yields' rise, Mitsubishi UFJ Morgan Stanley Securities' fixed income strategists say in commentary. Focus may also be on the BOJ's scheduled outright purchases today in three sectors of the JGB market including sovereign debt with tenors of more than 10-years and up to 25-years, the strategists add. 30 yen. 22 as gains in electronics and machinery shares offset losses in financial stocks.
Hitachi Ltd. 7% lower. 52. 18 as of Tuesday's Tokyo stock market close.
Investors are closely watching developments in the Middle East conflict, crude oil prices and bond yields. S. stock gains overnight as concerns about borrowing costs ease. 1% at 70940 on the SGX.
18 as of Tuesday's Tokyo stock market close. Investors are focusing on developments in the Iran conflict, crude oil prices and bond yields. 98 on Tuesday, closing above the 70000 threshold for the first time since July 1. com) 2334 GMT - Asian currencies consolidate against the dollar in early trade, but may be aided by appetite for risk assets.
"The S&P 500 rose to a fresh record high, supported by optimism around AI-related spending," CBA's Samara Hammoud says in a research report. The overnight rise in equities has boosted risk sentiment, the international economics and currency strategist says. S. 6981, LSEG data show.
com) 2328 GMT - The recent G2E casino gaming conference in Las Vegas reinforces the view at Morgan Stanley that the earnings backdrop remains supportive for Australia-listed slots makers. Reiterating an overweight rating on both Aristocrat Leisure and Light & Wonder, Morgan Stanley analysts say their meetings with casino operators, competitors and industry participants left them confident that the market leaders are positioned to take further share. They tell clients in a note that content remains the rivals' key competitive moat, pointing out that both are investing in proven franchises and extending properties across more products and channels.
com) 2249 GMT - Dicker Data's latest acquisition is viewed at UBS as an incrementally positive step despite its relatively small size. 8 million move for regional tech-solutions distributor Sektor Group helps develop its geographic expansion at an attractive acquisition multiple. They think the deal will be immediately accretive to EPS for the Australia-listed hardware and software distributor. With Dicker Data targeting southeast Asia, the UBS analysts want to see more evidence that Sektor can grow its revenues outside of Australia and New Zealand.
40 Australian dollars. 57 ahead of the open. com) 2238 GMT - Sports Entertainment Group's regional expansion helps the sports media group secure a new bull at Bell Potter. Initiating coverage of the stock with a buy rating, analyst Michael Ardrey tells clients in a note that the Australian company's recent acquisition of New Zealand-based audio and ad platform MediaWorks brings opportunities for organic growth and above-target cost synergies.
With a business that includes sports-talk radio, digital media and live events, Ardrey thinks Sports Entertainment can generate average annual Ebitda growth of 13% through fiscal 2029. 45 Australian dollars. 265 ahead of the open. com) (END) Dow Jones Newswires October 06, 2026 23:28 ET (03:28 GMT) Copyright (c) 2026 Dow Jones & Company, Inc.
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