China encourages elderly vaccination; Hong Kong closes 5% higher
Chinese authorities urges elderly to be proactive about vaccination
Chinese health authorities urged its elderly population to show initiative regarding vaccination.
Announcing a “new work plan,” Xia Gang, an NHC official in charge of immunization services, said that the government plans to “optimize services and publicity” to boost national vaccination rates, especially for the elderly.
“I also hope those elderly population, especially those over 80 years old … to please take your own initiative to vaccinate and to protect your own health,” said Xia, according to a translation of Tuesday’s briefing.
“We will earnestly implement the requirements of the state council and carefully organize and implement the vaccination work around the country,” he said.
– Jihye Lee
China says it is ‘closely watching’ virus developments when asked about shift in policy
Chinese health authorities said that officials are “closely watching” the developments of Covid when asked if protests in the region would lead to shifts in its zero-Covid policy.
“China has been following and closely watching the virus as it evolves and mutates,” officials said, according to a translation of Tuesday’s briefing.
– Christine Wang, Evelyn Cheng
Singapore banks’ exposure to crypto ‘insignificant’, says MAS Chairman
Singapore banks’ exposure to cryptocurrency is insignificant, said the chairman of Singapore’s central bank.
In response to a question in parliament, Tharman Shanmugaratnam, chairman of the Monetary Authority of Singapore, said banks will be required to hold $125 Singaporean dollars of capital for every $100 of cryptocurrency.
The MAS added that it will follow the framework of international standard-setter Basel Committee on Banking Supervision on treatment of banks’ exposure to digital assets.
“Pending the finalization of the framework, MAS requires Singapore-incorporated banks to apply a 1250% risk weight for exposures to riskier cryptoassets such as Bitcoin and Ether,” he said.
The measures seek to “ensure that banks maintain adequate capital and liquidity for such exposures,” he said.
– Sheila Chiang
China announces measures to boost elderly vaccination
China’s health authorities released a plan to boost elderly vaccination, according to a notice on the National Health Commission’s website.
Hong Kong-listed shares of CanSino Biologics extended gains in the afternoon session and rose as much as 18% shortly after the announcement was posted.
The notice said authorities should use multiple data points to accurately identify target groups for vaccination for the elderly.
Pinpoint Asset Management expects a positive message to be delivered at China Covid briefing
China’s state council is expected to deliver a positive message at the upcoming Covid press conference, but the announcement will not include a “milestone,” said Pinpoint Asset Management’s President Zhiwei Zhang.
“I think the message would be positive actually … there are quite many positive signals coming from the central and local governments,” said Zhang, who cited examples such as the government allowing residential compounds in Beijing to be opened.
However, he cautioned that the reopening will be a “long process” all the way leading up to March next year, and said the “medical system may not be able to support the transition” especially for the immediate winter season.
— Lee Ying Shan
Currency check: Asia-Pacific currencies strengthen sharply, led by the Chinese yuan
Both the onshore and offshore Chinese yuan strengthened against the dollar in Asia’s session ahead of a press conference on Covid measures.
The greenback lost 1.09% against the offshore yuan and 0.65% against the onshore yuan, with both trading around 7.16-levels. The offshore yuan traded near 7.24 per dollar before it strengthened sharply.
Chinese indexes pop ahead of Covid briefing
Indexes in China jumped more than 2% as investors closely watched for developments in the nation’s zero-Covid policy after seeing losses in the previous session.
Local media reported that the Chinese State Council will hold a press conference on Covid measures at 3 p.m. local time, or 2 a.m. ET.
The nation saw a drop in the number of daily infections for the first time in more than a week.
– Evelyn Cheng, Jihye Lee
China’s Xi will likely continue to be ‘very pragmatic,’ including on Covid policy, strategist says
Chinese President Xi Jinping has been realistic and practical on Covid, domestic real estate issues and politics since the end of the Communist Party of China’s National Congress, said Andy Rothman, an investment strategist at Matthews Asia.
“He’s been pragmatic on Covid policy, announcing a change in direction more towards living with Covid rather than Covid zero,” he said on CNBC’s “Squawk Box Asia” when asked about how the government might respond to recent unrest in parts of China.
“He’s been pragmatic on property, he’s been very pragmatic on dealing with Joe Biden, so I expect that to continue,” Rothman said.
He added that he views the unrests related to the prolonged zero-Covid policies as largely in line with what is expected to come from the Chinese government.
“What the protesters seem to be asking for, are things Xi Jinping has already said he wants to deliver,” he said. “He wants to deliver a path out of zero tolerance for Covid, towards living with Covid like all the rest of the world.”
Rothman added that the latest announcements to ease quarantine measures for international travelers suggests that delivering shifts from the zero-Covid policy will be “relatively easier.”
“He’s not backing down, [or] giving in under pressure, he’s just delivering, on a more accelerated pace, what he’s already told these students that he wants to give them,” he said.
— Abigail Ng
Oil prices jump more than a dollar ahead of China briefing
Oil prices climbed ahead of a press conference which will be held by China’s State Council, as investors continue to monitor developments – paring some losses seen on Monday, when it reached the lowest levels in almost a year.
However, oil markets may be “misjudging news of China’s lockdown,” Rystad Energy wrote in a note.
“[The latest lockdowns’] likely effect on China’s short-term oil demand, particularly in transportation, is likely to be minor,” the note added, citing the company’s own research of real-traffic activity in China.
Even with daily Covid cases continuing to climb, cities like Shanghai have not shown a slowdown in road traffic activity, according to Rystad Energy’s own research.
— Lee Ying Shan
China likely won’t make sudden changes to its Covid policy: National University of Singapore
The Chinese government is unlikely to make sudden changes to its zero-Covid policy as that will bring chaos, National University of Singapore Professor Wang Gungwu said on CNBC’s “Squawk Box Asia.”
“If you change the policy suddenly, I think the damage and the consequences would be even worse — it’d be really chaotic because I think the spread of Covid will be absolutely unprecedented,” said Wang.
He added that he expects Chinese leader Xi Jinping to make adjustments on more local levels to ease public dissent.
Wang said Xi doesn’t want to officially admit the “policy has been wrong for quite a while,” but also cannot change it immediately.
– Jihye Lee
Hong Kong-listed property stocks rise after China amends fundraising rule
Equities related to Hong Kong-listed property developers jumped after China’s regulator announced it would lift a ban on equity fundraising for the sector.
The China Securities Regulatory Commission announced five measures of support for the real estate market, including the removal of a multi-year restriction on property developers selling stocks to raise funding.
— Jihye Lee
Hong Kong on pace for best month since April 1999
Hong Kong’s Hang Seng index is on pace to post its best month since April 1999, when the index gained 21.85%.
The index rose more than 3% as of Tuesday morning, and is up around 22% for the month of November, according to Refinitiv data.
The HSI closed 1.57% lower on Monday, the worst day in a week, when the Hang Seng lost 1.87% on Nov. 21.
–Gina Francolla, Jihye Lee
Japan’s unemployment rate unchanged, retail sales miss estimates
Japan’s unemployment rate for October was steady from September’s reading of 2.6%, according to official data. The figure is slightly higher than the mean expectation of 2.5% from economists polled by Reuters.
The jobs-to-applicant ratio, which measures active job openings per jobseeker, was at 1.35. That indicates that there are 135 jobs available for every 100 applicants, signaling a still tight labor market in Japan.
The nation’s retail sales rose 4.3% in October on an annualized basis, missing expectations of 5% increase predicted in a separate Reuters poll .
The latest reading marks the first softening in retail sales growth that it’s seen since June this year.
– Jihye Lee
Fed should keep hiking into next year, Bullard says
James Bullard at Jackson Hole, Wyoming.
David A. Grogan | CNBC
St. Louis Fed President James Bullard said Monday that the Fed should continue to raise its benchmark interest rate in the coming months and that the market may be underestimating the chance that the Fed has to get more aggressive.
“We’re going to have to continue pursue our interest rate increases into 2023, and there’s some risk that we’ve have to go even higher than [5%],” Bullard said at a Barron’s Live webinar.
Bullard made waves in financial markets earlier this month when he said the Fed’s hikes have had “only limited effects” on inflation so far and that the benchmark interest rate may need to rise to between 5% and 7%.
Bullard, who is a voting member of the FOMC, said that the Fed will need to hold off any rate cuts next year even if the inflation picture starts to show consistent improvement.
“I think we’ll probably have to stay there all through 2023 and into 2024, given the historical behavior of core PCE inflation or Dallas Fed trimmed mean inflation. They will come down, I think. That’s my baseline. But they probably won’t come down quite as fast as markets would like and probably the Fed would like,” Bullard said.
— Jesse Pound
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