Founder of Antler Capital

Stanley Tsai, CFA

Macroeconomics

<ul>
<li>The recent rollout of a tax-deferred individual pension scheme marks a pivotal moment in the country's preparation for seismic shifts in its demographics.</li>
<li>The transition towards Pillar 3 of the retirement system has important implications for global asset allocators' long-term China investment thesis.</li>
<li>It's still early days, but there are ways to participate in the growth of private pensions. We look at the scale of the opportunities available and the potential beneficiaries.</li>
</ul>


The recent rollout of a tax-deferred individual pension scheme marks a pivotal moment in the country's preparation for seismic shifts in its demographics.
The transition towards Pillar 3 of the retirement system has important implications for global asset allocators' long-term China investment thesis.
It's still early days, but there are ways to participate in the growth of private pensions. We look at the scale of the opportunities available and the potential beneficiaries.


China's Fledgling Pensions Market: Are You Positioned to Cash In?

<ul>
<li>China's loan prime rates have held steady for a fifth month, with 1Y and 5Y benchmarks at 3.65% and 4.30%, respectively.</li>
<li>We expect to see a 15bp cut to the 5Y LPR as early as Feb. 20, in view of extremely weak domestic demand.</li>
<li>Even that may not be enough. Infrastructure spending will have to carry the load, fueled by a surge in local government bond issuance.</li>
</ul>


China's loan prime rates have held steady for a fifth month, with 1Y and 5Y benchmarks at 3.65% and 4.30%, respectively.
We expect to see a 15bp cut to the 5Y LPR as early as Feb. 20, in view of extremely weak domestic demand.
Even that may not be enough. Infrastructure spending will have to carry the load, fueled by a surge in local government bond issuance.


China Macro: Loan Prime Rates Unchanged in Jan; Easing Bias Remains

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Caixin Global

Articles from Caixin Global

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Cross Asset Strategy

<ul><li>In Depth: Chinese firms bending over backward to offer foldable phones</li><li>Shanghai says no plan to seal off entire city of 25 million</li><li>Chinese stocks get another drubbing as uncertainty overwhelms investors</li></ul>

In Depth: Chinese firms bending over backward to offer foldable phonesShanghai says no plan to seal off entire city of 25 millionChinese stocks get another drubbing as uncertainty overwhelms investors

CX Daily: Chinese Firms Bending Over Backward to Offer Foldable Phones

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Event-Driven

KraneShares CSI China Internet ETF / Event-Driven

<ul>
<li>China ADRs were sharply lower last week as the SEC started to name companies that were identified under the Holding Foreign Companies Accountable Act (HFCAA).</li>
<li>Then <a href="https://www.smartkarma.com/entities/didi-chuxing-inc" target="_blank" data-smartkarma-citation="entities:27467:1" rel="noopener">DiDi Global</a> dropped 44% on Friday following reports that the their proposals to prevent data/security leaks did not meet CAC's requirements and work on the HK listing was halted.</li>
<li>With 2024 not too far away, a lot of the U.S. listed companies will look at listing in Hong Kong in the near future. That will have its own implications.</li>
</ul>


China ADRs were sharply lower last week as the SEC started to name companies that were identified under the Holding Foreign Companies Accountable Act (HFCAA).
Then DiDi Global dropped 44% on Friday following reports that the their proposals to prevent data/security leaks did not meet CAC's requirements and work on the HK listing was halted.
With 2024 not too far away, a lot of the U.S. listed companies will look at listing in Hong Kong in the near future. That will have its own implications.


China ADRs & HFCAA: Pace of Homecoming Listings Should Pick Up & Implications

<ul>
<li>In the absence of an outright LPR cut later this month, the latest RRR move's impact on the real economy may be rather modest. </li>
<li>Assuming CNY500bn of MLFs will be withdrawn in the coming months, the net injection this time around is CNY700bn, about 40% of an average month's new loans.</li>
<li>We would watch out for a potential bubble in the onshore credit market before incremental liquidity benefits the broader economy.</li>
</ul>


In the absence of an outright LPR cut later this month, the latest RRR move's impact on the real economy may be rather modest. 
Assuming CNY500bn of MLFs will be withdrawn in the coming months, the net injection this time around is CNY700bn, about 40% of an average month's new loans.
We would watch out for a potential bubble in the onshore credit market before incremental liquidity benefits the broader economy.


China Macro: RRR Cuts' Diminishing Impact

China

Shenzhen Composite Index is an actual market-cap weighted index (no free float factor) that tracks the stock performance of all the A-share and B-share lists on Shenzhen Stock Exchange. The index was developed on April 3, 1991 with a base price of 100. 

Shenzhen Stock Exchange Composite Index (SZCOMP INDEX)

Shenzhen Stock Exchange Composite Index (SZCOMP INDEX)

China's Fledgling Pensions Market: Are You Positioned to Cash In?

China's aging population has captured investors' attention of late. What opportunities will shifting demographics bring to the fledgling private...

Stanley Tsai, CFA

China Macro: Loan Prime Rates Unchanged in Jan; Easing Bias Remains

China's LPRs have held steady, but we believe a cut to the mortgage benchmark is imminent. A recovery in home prices may prove elusive. Debt-fueled...

Stanley Tsai, CFA

CX Daily: Chinese Firms Bending Over Backward to Offer Foldable Phones

In Depth: Chinese firms bending over backward to offer foldable phones. Shanghai says no plan to seal off entire city of 25 million

Caixin Global

China ADRs & HFCAA: Pace of Homecoming Listings Should Pick Up & Implications

The SEC naming 5 companies under the HFCAA put China ADRs under pressure last week. The news that the CAC had nixed DIDI's HK listing plans added...

Brian Freitas

China Macro: RRR Cuts' Diminishing Impact

In the absence of an LPR cut, the impact of the latest RRR move may be limited. We estimate that net of MLF maturities, the liquidity boost is...

Stanley Tsai, CFA