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On October 12th, DBS Group CEO Shushan Chen stated that the market is reassessing the risks associated with investments in artificial intelligence (AI) infrastructure, which could lead to a more cautious AI financing environment. She said, "The market has sent a signal. This isnt a bad thing, because investors are now demanding higher returns and paying more attention to financing structures." Chen pointed out that the market is examining whether the large amounts of capital invested in the AI capital expenditure ecosystem can generate sufficient long-term returns to ultimately repay debt, bond, or equity investors. DBS believes that some weaker companies may face the risk of credit rating downgrades. However, Chen believes this risk repricing is "healthy" because the market wants to ensure that large-scale AI investments are sustainable and have long-term profitability. She stated, "The market is confirming whether these huge investments are truly sustainable." Chen revealed that DBS has participated in approximately $20 billion in AI-related transactions this year, mostly as the lead arranger for syndicated loans, but the bank itself only holds a small portion of the risk exposure.On Monday, October 12, the Hang Seng Index opened 223.58 points higher, or 0.92%, at 24,434.93; the Hang Seng Tech Index opened 43.23 points higher, or 1.03%, at 4,241.07; the H-share Index opened 81.45 points higher, or 1.0%, at 8,229.32; and the Red Chip Index opened 12.18 points higher, or 0.3%, at 4,061.13.Hang Seng Index futures opened 0.85% higher at 24,398 points, a premium of 187 points.The Governor of the Bank of Korea said the timing and pace of further interest rate hikes will depend on the data.The main platinum contract rose by 2.00% intraday, currently trading at 419.00 yuan/gram.

When is China's Consumer Price Index Calculated and How Might It Affect the AUD?

Drake Hampton

Apr 11, 2022 10:08

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The National Bureau of Statistics of China is scheduled to issue the Chinese Consumer Price Index and Producer Price Index at 01:30 GMT on Monday.

 

Meanwhile, the economic toll imposed by the coronavirus will be a source of concern for financial markets. Since 28 March, Shanghai has been in lockdown. The city of 26 million residents reported 1,006 confirmed infections and nearly 24,000 asymptomatic cases in the preceding 24 hours, compared to China's total of 23,107 on April 7. Indeed, Omricon is projected to have a significant impact on China's economy. The most current hard data on China's economy are from January and February, which are out of date in light of the Ukraine war, soaring oil prices, and a fresh batch of covid-19 cases.

What is AUD's Reaction Likely to Be?

The price of AUD, which is used as a proxy for Chinese economic events, would come under pressure if the Chinese economy's outlook deteriorated. Today's statistics could be detrimental to the Australian dollar due to the potential of stagflation. Inflation in China has remained subdued thus far this year, with enterprises being burdened by persistently high PPI and rising raw material prices, while the low CPI figure reflects the country's current weak domestic demand. On Monday, the AUD/USD is already under pressure, down 0.2 percent with 30 minutes remaining till the release of the report.

Concerning the China CPI

China's National Bureau of Statistics publishes the Consumer Price Index. It is a metric for the range in retail prices across a representative basket of products and services. The outcome is a thorough summary of the findings from the urban and rural consumer price indices. Inflation erodes the CNY's purchasing power.

 

The CPI is a critical statistic for determining inflation and changes in consumer spending trends. A significant increase in the consumer price index indicates that inflation has become a destabilizing element in the economy, causing the People's Bank of China to tighten monetary policy and increase fiscal policy risk. In general, a high reading is considered beneficial (or bullish) for the CNY, while a low reading is considered negative (or bearish).

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