RBNZ ‘Live’ in October, $16 Trillion Due, China Bailout: Eco Day

(Bloomberg) -- Happy Friday, Asia. Here’s the latest news and analysis from Bloomberg Economics to take you through to the weekend:

• New Zealand central bank Governor Adrian Orr gave the clearest indication yet that policy makers plan to raise the official cash rate at their next meeting in October, even if there are still virus cases
• A blowout in borrowing by governments since the pandemic began, as they rolled out about $16 trillion in fiscal measures, will ultimately require spending cuts and higher taxes
• The Huarong Asset Management Co. bailout by government-backed investors makes one thing clear -- some firms are indeed ‘too-big-to-fail’ in China, says Bloomberg Economics.
• China’s delta variant outbreak may have turned a corner, though high-frequency data suggest consumption will still take time to rebound
• China’s top legislative body is expected to approve a proposal to impose an anti-sanctions law on Hong Kong, a retaliation against the U.S. that could put global firms in the cross-hairs
• Japan’s consumer prices dropped less than expected in July, although they still extended the longest losing streak in a decade
• All eyes are on the Bank of Korea as most likely to lead policy tightening in Asia, Bloomberg Economics says of the week ahead
• Applications for U.S. state unemployment benefits dropped for a fourth consecutive week. The result adds to the Fed’s case for possibly embarking on the tapering of asset purchases this year
• Thailand is heading for a rare current account deficit with the country missing out on the billions of dollars earned from tourism
• The slow pace of borrowing by local governments in China and curbs on the property market mean the economy will receive less of a boost this year from infrastructure investment than initially thought
• The ECB’s recent revamp of plans for interest rates is only a first step in its new strategy, according to chief economist Philip Lane
• Most German companies expect widespread supply-chain problems to persist into next year, threatening to damp the economy’s recovery
• U.S. Vice President Kamala Harris will look to bolster economic and military ties in China’s backyard as she visits Singapore and Vietnam
• Canadians are piling into mortgages at more than double the historical pace as the housing market appears set to moderate
• The Fed said Chair Jerome Powell will deliver his remarks virtually at the annual Kansas City Fed’s Jackson Hole symposium
• Finland, which consistently outranks other nations as the world’s happiest, is about to map out how the money the government spends impacts children, to further improve their lives
• Among Indian Prime Minister Narendra Modi’s myriad options to help revive his economy from a rare contraction brought on by the Covid-19 pandemic, “Project Tiger” is definitely among the most unlikely

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