Weekly Market Update - 5 December 2022

Reopening The Economy

Chinese authorities accelerated a shift toward reopening the economy, with Shanghai and Hangzhou easing some Covid restrictions after protests last weekend. Shanghai will scrap PCR testing requirements to enter outdoor public venues such as parks, while Hangzhou, home to tech giant Alibaba, said it would drop testing requirements for entry into most public venues. They join other top-tier cities such as Beijing, Shenzhen and Guangzhou in relaxing curbs in recent days.

Source: Bloomberg

Streamlining Operations

HSBC is reviewing its New Zealand retail banking operations as the lender looks for ways to streamline its footprint while heading off calls for a full-blown breakup. The news comes after the bank announced it would sell its Canadian unit for $10 billion and close more than 100 branches in the UK. The bank disposed of its French and US retail operations last year, agreed to sell its Russian unit in July and said in November it will merge its Omani unit with a local lender. HSBC has been fighting off calls from shareholder Ping An to break up of the bank.

Source: Bloomberg

Policy Assessment

The Bank of Japan should conduct a policy assessment, with the timing dependant on inflation, wages and the economy, according to board member Naoki Tamura in his first exclusive interview. Tamura is the first board member to explicitly suggest the need for a policy assessment, after the bank conducted its most recent review in March last year. In the past, review results have often come with policy adjustments, including the introduction of the yield curve control program in 2016. The end of Governor Haruhiko Kuroda’s decade-long term in April has also generated speculation of policy shifts.

Source: Bloomberg