Global Markets Overview is published and updated every month. This includes what has happened in markets, our macroeconomic outlook and price updates on assets such as government bonds, credit and equities.
In this Global Markets Overview
Global Markets Overview
The top highlights from our latest Global Market Overview.
Our October Global Markets Overview explores the decline in China's nominal GDP growth alongside declines in M1 growth.
- M1 growth is a measure of money supply, e.g., cash and other types of deposits that can be used as cash. Money supply can provide some information about the short-term direction of an economy and the level of prices. Weak M1 growth in China is one signal of the importance of more stimulus to invigorate economic growth and inflation. The Chinese economy has until recently continued to surprise to the downside on growth.
- In response, the People's Bank of China and Chinese government have launched stimulus measures. From cuts in reserve requirements and lending rates to fiscal injections aimed at boosting both the equity and housing markets, these initiatives provide an impetus for demand to stimulate economic activity. Notably, these measures are not just about making credit cheaper but are aimed at addressing the deeper issue of insufficient demand.
- These developments impact China but also the broader global economy. In the first instance, this has sharply boosted Chinese equities – but we could also potentially see positive implications for the global manufacturing sector and, therefore, global markets, and global risk sentiment.
