Tencent’s discount to Facebook harder to justify

April 7, 2015

The Chinese social media giant generated about the same revenue as its U.S. counterpart last year and was more profitable, despite having fewer users. Yet it trades at a lower multiple of earnings. As the two business models converge, the valuation gap needs a rethink.

Clipping Indian central bank’s wings is bad idea

March 30, 2015

The Reserve Bank of India is facing a campaign to undermine it. Subjecting its regulatory decisions to judicial review will erode its authority. Removing the bond market from its control serves little purpose. Investors can live with a bossy RBI, but not a weak one.

India’s infrastructure push could be envy of West

March 2, 2015

The government has pushed back its deficit reduction target in order to boost spending on roads, rail and power. New Delhi is now unmistakably pursuing a public investment-led growth strategy. It’s an opportunity that rich nations, which can borrow far more cheaply, are missing.

Cheaper oil no friend to Asia’s households

December 24, 2014

Real wages are growing 2 percentage points below their long-term average, reflecting labour’s weak bargaining power amidst slowing growth. Falling oil prices and low inflation could prompt employers to be even more tight-fisted in 2015. Household finances might wobble.

China will make 2015 year of missed opportunities

December 22, 2014

Foreign investors hope for a more open, balanced China. Its leaders have other ideas. They favour reforms that minimise financial instability, punish bad eggs, and nurture national champions. President Xi Jinping’s popularity quest will raise tensions with the rest of the world.

Cheap oil worsens Asian debtors’ lowflation woes

November 28, 2014

Sliding energy prices could make already-low Asian inflation vanish. That’s bad news for heavily indebted economies like China, South Korea, Thailand, Malaysia and Singapore. If prices and wages don’t rise, borrowers will curb spending. Slowing GDP growth could stumble.

China monetary policy enters difficult adolescence

November 24, 2014

Cutting rates, as the central bank just did, is far less simple than when China’s economy was in its pliant infancy. New ways to save, borrow and arbitrage have sprouted, and don’t all respond predictably to orders. It will take more to alleviate private sector growing pains.

China’s stock connection: a guide to the perplexed

November 14, 2014

Hong Kong and Shanghai are about to activate a long-awaited link between their exchanges. The hook-up could have big implications for investors. But it’s also restrained by China’s determination to limit cross-border capital flows. Breakingviews explains what’s at stake.

Cheap oil is no tonic for sluggish Asian economies

October 17, 2014

Less expensive petrol and diesel mean smaller subsidy bills and healthier budgets in India and Indonesia. For others in the region, though, falling crude prices are a worrying sign of stalling global growth. Asia has too much debt to welcome disinflation.

Real estate rescue may not help China’s developers

October 16, 2014

Homebuyers will still spend if prices and financing are attractive. But property companies are selling more for less, which beats down their margins. If a pick-up comes at the expense of profitability, things will continue to get worse for Chinese housebuilders.