Moody’s Analytics’s Ell Sees Fiscal, Monetary Policy Support in China Into 2020

The video discusses the economic challenges faced by China and South Korea. China's economy is expected to receive continued fiscal and monetary support, including small policy rate cuts and infrastructure spending, to navigate through a difficult period. Despite some easing in US-China trade tensions, significant tariffs remain, hindering China's manufacturing and export sectors. South Korea faces its own challenges with weak global demand affecting exports and manufacturing, compounded by weak domestic demand. The Bank of Korea and fiscal policies provide some support, but a significant rebound is not expected soon.

What measures are expected from China to support its economy?

• Continuation of fiscal and monetary policy support

• Increase in import tariffs

• Reduction in infrastructure spending

• Increase in interest rates

What is the current status of the trade war between the US and China?

• Completely resolved

• No tariffs were ever imposed

• De-escalated but existing tariffs remain

• Escalating with new tariffs

Why is it challenging for China's PMI to return to expansionary territory?

• Significant existing tariffs

• Lack of government support

• High domestic demand

• Strong global economic environment

What are the main economic challenges faced by South Korea?

• High inflation rates

• Surplus in trade balance

• Weak exports and manufacturing

• Strong domestic demand

Despite support from the Bank of Korea, why is there no significant improvement in South Korea's economy?

• Strong global demand

• Weak global environment and domestic demand

• High levels of foreign investment

• Rapid technological advancements