【英文】汇丰银行报告：全球货币宽松不济Global Economics：Putting the air back in (114P)

With the trade uncertainty persisting, those that rely on global trade and manufacturing industries are  clearly more vulnerable to being dragged down by global developments. Taking three key indicators:  merchandise exports as a share of GDP, manufacturing as a share of GDP and a sensitivity  measure of each country’s exports to import demand from the US and mainland China, we can see  which are facing the fiercest headwinds in this world (chart 15).   Those in the top right of the chart look particularly vulnerable as long as world trade  continues to slow – Taiwan, Thailand, Malaysia, Korea, Germany and Poland. Clearly some  of these have so far been more resilient than others: Malaysia and Poland have seen a  pick-up in domestic consumption which is offsetting any external drag, and fiscal stimulus  has played an important role here.   Others have large manufacturing industries, but are relatively closed and some may be  more closed or not exposed to manufacturing but suffer from being tied to US and mainland  Chinese demand. Brazil and Australia stand out in the latter case because of their mainland  China exposure, despite being in the bottom left of chart 15.   In the top left, Japan is bunched closely with Indonesia and the Philippines – yet tellingly, as we  discuss below, the latter two have considerably more room to provide monetary and fiscal  stimulus than Japan should their manufacturing sectors feel the pinch from global weakness.

Acutely aware that their ability to respond to the slowdown in global growth and lower-thandesired inflation is more constrained in the face of this downswing than the last, central banks  around the world continue to respond by easing monetary policy. The prescription has not been  uniform though. In the advanced world the Fed, which clearly has more scope to ease than  most, has already cut by 50bps in Q3 and we expect one more 25 bps reduction by end-year.  The ECB’s promised package of measures (another 10bp deposit rate cut, open-ended QE and  more forward guidance) was duly delivered on 12 September. China also stepped up its  monetary easing as the economy slowed further over the summer but in a more selective way  than in the past. Reserve requirements and some lending rates have been lowered but  policymakers’ caution seems to reflect a determination not to further inflate the housing market  and perhaps a desire to keep some policy powder dry if this proves to be a prolonged trade  dispute. Such China-related trade tensions could well extend into the next US administration. Other emerging economies have followed suit or even led the Fed, including some that are still  paying lip service to financial stability risks: the growth risks are now tipping the balance though.  The central banks that raised rates in 2018 and have already taken steps to reverse the moves  include India, which has already taken rates down by 110bps this year and looks set to deliver  another 50bps by the end of Q4 2019, but also include Indonesia and the Philippines.