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Please be advised that future verbal and written communications from the bank may be in English only. These communications may include, but are not limited to, account agreements, statements and disclosures, changes in terms or fees; or any servicing of your account.

Por favor, tenga en cuenta que es posible que las comunicaciones futuras del banco, ya sean verbales o escritas, sean únicamente en inglés. Estas comunicaciones podrían incluir, entre otras, contratos de cuentas, estados de cuenta y divulgaciones, así como cambios en términos o cargos o cualquier tipo de servicio para su cuenta.

Informamos que as futuras comunicações do banco, verbais e escritas, podem estar disponíveis apenas em inglês. Essas comunicações podem incluir, entre outras, acordos de conta, extratos de conta e divulgações, alterações aos termos ou tarifas, ou qualquer tipo de serviço pertinente à sua conta.

仅此通知,本行即日起发出的口头及书面通信可能将只提供英文版本。这些通信可能包括但不限于账户协议,账单和通知,条款或费用变更;或任何为您账户提供的服务。

Please be advised that future verbal and written communications from the bank may be in English only. These communications may include, but are not limited to, account agreements, statements and disclosures, changes in terms or fees; or any servicing of your account.

Por favor, tenga en cuenta que es posible que las comunicaciones futuras del banco, ya sean verbales o escritas, sean únicamente en inglés. Estas comunicaciones podrían incluir, entre otras, contratos de cuentas, estados de cuenta y divulgaciones, así como cambios en términos o cargos o cualquier tipo de servicio para su cuenta.

Informamos que as futuras comunicações do banco, verbais e escritas, podem estar disponíveis apenas em inglês. Essas comunicações podem incluir, entre outras, acordos de conta, extratos de conta e divulgações, alterações aos termos ou tarifas, ou qualquer tipo de serviço pertinente à sua conta.

仅此通知,本行即日起发出的口头及书面通信可能将只提供英文版本。这些通信可能包括但不限于账户协议,账单和通知,条款或费用变更;或任何为您账户提供的服务。

Silhouette of joyful young Asian mother holding hands of cute little daughter looking at airplane through window at the airport while waiting for departure

Perspectives

Vaccination, reflation, resumption

Ken Peng

By Ken Peng

Head - Asia Investment Strategy

March 11, 2021Posted InInvestment Strategy

The recent market shake-up from higher real rates reflect progress in recovery, rather than the end of it. As we’ve emphasized since vaccines became available late last year, recovery and reflation would engender a rotation in equities, while long end interest rates are likely to rise and steepen the yield curve. All of these are making good progress.

In Asia, inflationary pressures and external financing needs are both in good shape. Average CPI is lower than that of the US, while real rates are much higher. Current account surpluses have widened markedly during the pandemic, building up FX reserves while external debt issuance had been limited.

These offer policymakers (with the notable exception of China’s) ample room to nurse the economic recovery, without having to worry much about capital outflows and the exchange rate impact of higher US real rates.  

The pace of vaccinations in Asia is relatively slow compared to many Western countries, partly because of the large population and partly because of the far lower rates of infections and outstanding cases. But some acceleration is likely in coming months.

China now has four approved vaccines, including a highly effective single-dose product from CanSino.

India is a vaccine production hub and is gearing up capacity. Together with China, they account for half of global production. Moreover, India may be much closer to herd immunity than the vaccination data would suggest.

Singapore has become the model for efficient vaccination rollout and planning, which could put it at the top of the list for travel resumption agreements in Asia.

Along with the vaccinations, travel resumption is just a matter of time. When it happens, we look at China’s recent experience for clues on pent-up demand. In 2H 2020 and during the Lunar New Year holiday this year, China has shown massive demand growth for some of most pandemic battered industries, such as travel & leisure, retail, hospitality, and gaming, as both revenue and pricing power return to the businesses. This could be repeated elsewhere in the region when travel resumes.

Download: Asia Strategy