17 December 2017

Eric Lui

Hong Kong Economic Journal chief economist and strategist
  • Stronger dollar and rising oil prices will lead to higher cost pressure and rising inflation. Photo: Reuters

    2017 global growth and inflation outlook

    - Dec 8, 2016 5:14pm
    As we prepare to bid goodbye to 2016, it’s time to make a prediction of the top 10 macro trends for next year. This week, I will start with global growth outlook and the prospects for...
  • Historically, the US dollar typically moved in opposite direction to commodity prices, but next year could be an exception. Photo: Reuters.

    Dollar index could surge to 107 next year

    - Dec 1, 2016 5:10pm
    The US dollar index broke out of its previous range following Donald Trump’s election victory and has posted sharp gains since then. Is the greenback poised to rise further? At the moment, the consensus is for...
  • US dollar strength, amid expectations of a Fed rate hike, has led to fund outflow from emerging markets recently. Photo: CNSA

    Will emerging markets face another financial turmoil?

    - Nov 24, 2016 5:00pm
    Bond yields and US dollar have both seen sharp gains since Donald Trump won the US presidential election earlier this month. There are worries that emerging markets may witness fresh financial turmoil, like what we saw...
  • Donald Trump is expected to lean more heavily on fiscal stimulus to bolster the economy, which implies large issuance of bonds and higher inflationary pressure.  Photo: Reuters

    Trump era could mean financial turmoil for emerging markets

    - Nov 17, 2016 4:52pm
    The ecosystem of financial markets is likely to go through fundamental changes after Donald Trump officially takes over the helm. That might trigger another wave of financial market turmoil in the future. The Federal Reserve had...
  • Easy monetary policy and the lack of other investment options prompted many Chinese to bet on properties. Photo: China News

    China housing bubble: When will it burst?

    - Nov 3, 2016 5:09pm
    Images of frenetic fighting by prospective homebuyers underscore the crazy housing market in China. Beijing has unveiled a set of measures to cool the frenzy, but the policy moves can only go so far in terms...
  • A significant portion of companies listed in Hong Kong generate the bulk of their businesses from China. Thus, a weaker yuan will weigh on their earnings. Photo: CNSA

    What does a weak yuan mean for Hong Kong equities?

    - Oct 27, 2016 4:45pm
    The offshore renminbi recently tumbled to a six-year low. How will that affect Hong Kong equities? Lots of Hong Kong-listed companies derive a significant portion of their earnings from China. A weaker yuan therefore hurts. About...
  • Factors such as easy monetary policy and continued capital outflows are likely to push the renminbi lower against the greenback in the next few months. Photo: China Daily

    Will the renminbi see more downward pressure?

    - Oct 20, 2016 5:03pm
    The depreciation of the Chinese renminbi has been a hot topic in the market recently. Since the People’s Bank of China (PBoC) introduced a 2 percent depreciation of the official daily midpoint fixing on Aug. 11...
  • Concerns over the negative impact of a hard Brexit and diverging monetary policies between the Federal Reserve and the Bank of England are likely to push the pound lower over the long run. Photo: AFP

    The worst is yet to come for the British pound

    - Oct 13, 2016 5:15pm
    Sterling plunged over 6 percent against the US dollar within three minutes to 1.1841 last week, hitting its lowest level in 31 years. While it has seen a moderate rebound since then, the flash crash points...
  • Other than a decline in investment interest, the UK economy has so far been doing much better than expected since the Brexit vote. Photo: Reuters

    Brexit uncertainties linger, but negative impact limited so far

    - Oct 6, 2016 3:48pm
    Following the Brexit vote in June, there have been lots of discussions about Britain’s post-EU arrangements, which can be loosely categorized as “hard” or “soft” options. Generally speaking, a hard Brexit arrangement would likely see the...
  • As the Fed kept rates unchanged, property transactions in Hong Kong surged recently, making the third quarter one of the best in the past three years. Photo: HKEJ

    Why the rate risks to property market may be overblown

    - Sep 29, 2016 4:56pm
    Hong Kong’s finance chief John Tsang has urged people to remain vigilant against a potential interest rate hike and the subsequent market volatility that the tightening move might trigger. Let’s now take at a look the...
  • Home price recovery gathered pace in August but with the market quite overbought, correction pressure is building up. Photo: HKEJ

    How long will Hong Kong’s housing boom last?

    - Sep 22, 2016 5:31pm
    The Centa-City Leading Index (CCL), a gauge of Hong Kong’s secondary housing prices, bottomed out in the first quarter. The pace of recovery picked up gradually and has been accelerating since August, lifting prices to the...
  • Federal Reserve chair Janet Yellen has hinted at a rate rise before the end of this year. But many factors may limit the Fed's room to tighten its monetary policy. Photo: Bloomberg

    Will fiscal stimulus replace monetary easing as policy focus?

    - Sep 19, 2016 10:07am
    Although the market is closely watching the Federal Reserve’s rate decision, the climbing yields in major government bond markets may actually offer more important implications. As we noted earlier, whether rates are hiked this month or...
  • A high short-selling ratio is often a buying signal as individual investors tend to start short-selling aggressively when the market has already fallen too much. Photo: moneypalm. com

    What does a high short-selling ratio tell you?

    - Sep 8, 2016 5:18pm
    Does short-selling data give any indication of future market direction? Let’s delve into the topic using historical data from the past 15 years. There are more than 800 shortable stocks in Hong Kong. The short-selling ratio...
  • High leverage of the US economy and negative impact of a strong dollar are among the factors that have weighed on Janet Yellen's mind when it comes to interest rates. Photo: Bloomberg

    What’s holding back Janet Yellen?

    - Sep 1, 2016 6:20pm
    Fed chair Janet Yellen’s speech at the Jackson Hole meeting and hawkish comments by vice chairman Stanley Fischer have boosted market expectations for a rate hike in the short term. Now, will the US dollar stage...
  • As the property market bounced back along with the stock market, long queues reappeared at new project launches. Photo: HKEJ

    Why the property market recovery won’t be just a blip

    - Aug 25, 2016 4:42pm
    The overall housing market has shown signs of strong recovery as indicated by the secondary housing price index and new home sales. What has been underpinning this uptrend? Is it going to sustain? The Centa-City Leading...
  • Falling corporate earnings and a jump in selling from insiders are some of the worrying signs in the US stock market. Photo:

    US stock market shows three worrying signs

    - Aug 19, 2016 9:52am
    Wall Street continued to set new highs earlier this week. Fund flow data indicates quite clearly the recent rally in US stocks has been underpinned largely by capital outflows from Europe into the United States and...
  • Fund inflows from Europe triggered by the Brexit vote could be the driving force behind the recent US stock rally. Photo: AFP

    What’s behind the recent strength of US stocks

    - Aug 11, 2016 4:04pm
    The US stock market has done extremely well in recent months and it seems the rally has little correlation with monetary easing. US equities have constantly set new highs after the Brexit vote. Three US benchmarks...
  • The Coppock indicator has done a fairly good job in identifying long-term buying opportunities for Hang Seng Index. Photo: HKEJ

    Coppock Indicator sends buy signal for Hang Seng Index

    - Aug 4, 2016 4:00pm
    The Coppock indicator of the Hang Seng Index sent out a long-term buy signal at the end of last month. Such a signal is rare and has proved to be fairly accurate over the years. The...
  • Following a correction since September last year, home prices in Hong Kong have shown signs of a mild rebound in recent months. Photo: HKEJ

    Starter homes to lead modest property market rebound

    - Jul 28, 2016 6:39pm
    The Centa-city Leading Index (CCL), a gauge of secondary housing market in Hong Kong, has fallen back since mid-September last year. The index has shed 13.2 percent, in line with my earlier forecast for a 10...
  • Hong Kong’s monetary base has expanded faster than that of the US or Japan, driving up housing prices. Photo: Reuters

    Credit market bubble expected to burst in two years

    - Jul 21, 2016 5:24pm
    I said last week that housing prices in Hong Kong may collapse in 2018 or 2019 as a result of the bursting of the global credit bubble. Since the 2008 financial crisis, the ratio of credit...

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