Neal Kimberley

Neal Kimberley

UK-based Neal Kimberley has been active in the financial markets since 1985. Having worked in sales and trading in the dealing rooms of major banks in London for many years, he moved to ThomsonReuters in 2009 to provide market analysis. He has been contributing to the Post since 2015 and writes about macroeconomics from a market perspective, with a particular emphasis on currencies and interest rates.

Latest from Neal Kimberley

Macroscope | Can renminbi bulls expect a reprieve any time soon?

Tighter US monetary policy is in the offing and should continue to provide general support for the US dollar on the foreign exchanges. China’s coronavirus-related lockdowns are a big headwind for the economy, justifying a weaker yuan from a currency market perspective.

Tighter US monetary policy is in the offing and should continue to provide general support for the US dollar on the foreign exchanges. China’s coronavirus-related lockdowns are a big headwind for the economy, justifying a weaker yuan from a currency market perspective.

18 May 2022 - 1:30AM
Macroscope | Is the dollar peg still in the Hong Kong economy’s best interest?

While the dollar peg has served the city well, that is no guarantee it will always be the case. Given local economic conditions and growing geopolitical rivalry, Hong Kong needs to ask if following the US’ lead on monetary policy is still wise.

While the dollar peg has served the city well, that is no guarantee it will always be the case. Given local economic conditions and growing geopolitical rivalry, Hong Kong needs to ask if following the US’ lead on monetary policy is still wise.

10 May 2022 - 1:15PM
Macroscope | What China’s new infrastructure plan, Fed interest rate rises and yen weakness mean for the world

While a hawkish turn in US monetary policy is driving the value of the dollar, China’s plan to boost spending is likely to raise the price of dollar-denominated commodities. As a result, countries that must purchase US dollars to buy commodities may find themselves in a dilemma.

While a hawkish turn in US monetary policy is driving the value of the dollar, China’s plan to boost spending is likely to raise the price of dollar-denominated commodities. As a result, countries that must purchase US dollars to buy commodities may find themselves in a dilemma.

3 May 2022 - 4:00PM
Macroscope | How China’s neutrality on Ukraine war fuels the narrative of a weakening yuan

Rising US Treasury yields and the ripple effects of China’s ‘zero-Covid’ policy are adding to the allure of the US dollar for investors. Negative reactions to China’s neutrality over Ukraine also raises the chances of Western investors pulling out of Chinese assets and the yuan.

Rising US Treasury yields and the ripple effects of China’s ‘zero-Covid’ policy are adding to the allure of the US dollar for investors. Negative reactions to China’s neutrality over Ukraine also raises the chances of Western investors pulling out of Chinese assets and the yuan.

26 Apr 2022 - 12:41PM
Macroscope | Should Ukraine war fallout prompt Hong Kong to rethink its currency peg to the US dollar?

Washington’s move to freeze Russia’s central bank assets has cast doubt over the once unquestionable safety of US Treasuries holdings. Should dollar supremacy seriously begin to wane, it may be time to re-evaluate the over three-decade-old US-Hong Kong dollar peg.

Washington’s move to freeze Russia’s central bank assets has cast doubt over the once unquestionable safety of US Treasuries holdings. Should dollar supremacy seriously begin to wane, it may be time to re-evaluate the over three-decade-old US-Hong Kong dollar peg.

20 Apr 2022 - 8:15AM
Macroscope | Why US-China monetary policy split could be good news for currency investors

Hawkish sentiment in the US and more easing in China could leave policymakers in Asia-Pacific countries exposed to both in a difficult spot. For currency investors who are adept at reflecting changing circumstances and identifying value, though, this divergence spells opportunity.

Hawkish sentiment in the US and more easing in China could leave policymakers in Asia-Pacific countries exposed to both in a difficult spot. For currency investors who are adept at reflecting changing circumstances and identifying value, though, this divergence spells opportunity.

13 Apr 2022 - 1:24AM
Macroscope | Global economic flux means yuan bulls would do well to change focus from US dollar

Three of the world’s largest economies – the US, China and Europe – are each in a different predicament. This has implications not only for the dollar-yuan exchange rate but also for yuan internationalisation.

Three of the world’s largest economies – the US, China and Europe – are each in a different predicament. This has implications not only for the dollar-yuan exchange rate but also for yuan internationalisation.

5 Apr 2022 - 1:30PM
Macroscope | No reason for China to repeat 2015 currency devaluation even as the Japanese yen nosedives

This year is not 2015, and Beijing must look beyond Japan’s short-term competitive edge to preserve China’s wider interests. The monetary conditions and deflationary mindset in place are unique to Japan’s economy, and China would be well advised to stand firm.

This year is not 2015, and Beijing must look beyond Japan’s short-term competitive edge to preserve China’s wider interests. The monetary conditions and deflationary mindset in place are unique to Japan’s economy, and China would be well advised to stand firm.

29 Mar 2022 - 1:30PM
Macroscope | Why the Fed’s hawkish inflation turn isn’t necessarily bad news for China’s economy

Beijing’s fiscal and monetary policy options should insulate it if tighter Fed policy tips the US economy into recession. The combination of broad pledges of government support and a shift towards an economy more driven by domestic demand will ease China’s exposure.

Beijing’s fiscal and monetary policy options should insulate it if tighter Fed policy tips the US economy into recession. The combination of broad pledges of government support and a shift towards an economy more driven by domestic demand will ease China’s exposure.

23 Mar 2022 - 4:00AM
Macroscope | How sanctions on Russia could push countries to diversify foreign reserves, leading to increased yuan demand

Western sanctions cutting Moscow off from its foreign reserves give China greater incentive to move away from the US dollar and euro, and may push other countries to follow suit. Beijing may also be tempted to buy discounted Russian commodities as prices surge elsewhere.

Western sanctions cutting Moscow off from its foreign reserves give China greater incentive to move away from the US dollar and euro, and may push other countries to follow suit. Beijing may also be tempted to buy discounted Russian commodities as prices surge elsewhere.

16 Mar 2022 - 6:45AM
Macroscope | Ukraine invasion: China’s economy is not immune from the effects of Western sanctions on Russia

Commodity prices were already high, and the war in Ukraine will make the energy, food and raw materials that drive China’s economy even more costly. Given the risks, Beijing might well conclude its interests are best served by not going far beyond ‘normal’ trade with Russia.

Commodity prices were already high, and the war in Ukraine will make the energy, food and raw materials that drive China’s economy even more costly. Given the risks, Beijing might well conclude its interests are best served by not going far beyond ‘normal’ trade with Russia.

9 Mar 2022 - 1:47PM
Macroscope | Ukraine crisis: yuan’s emergence as a safe haven a win for China’s economy

The Chinese economy is the world’s manufacturer but it needs to import a vast amount of energy, raw material and food. With commodity prices spiking due to Russia’s invasion of Ukraine and growing risks of imported inflation, the yuan’s resilience is a positive sign.

The Chinese economy is the world’s manufacturer but it needs to import a vast amount of energy, raw material and food. With commodity prices spiking due to Russia’s invasion of Ukraine and growing risks of imported inflation, the yuan’s resilience is a positive sign.

9 Mar 2022 - 1:53PM
Macroscope | Why China is a better bet for investors, even as US Fed raises interest rates

Given the high US inflation rate, whatever the Fed does in the coming months, the reality is that investors in US Treasuries will be earning a negative real return. With China, however, investors can be sure that fiscal and monetary policy will remain stimulatory to support the economy.

Given the high US inflation rate, whatever the Fed does in the coming months, the reality is that investors in US Treasuries will be earning a negative real return. With China, however, investors can be sure that fiscal and monetary policy will remain stimulatory to support the economy.

22 Feb 2022 - 2:30PM
Macroscope | US inflation and interest rates: why the Fed needs help from China

Since the inflationary pressure on the US is partly a consequence of supply chain dislocations, fast and hard rate hikes won’t be enough if Chinese production does not get back into top gear. Such considerations are why investors expecting the US dollar to strengthen against the yuan may be disappointed.

Since the inflationary pressure on the US is partly a consequence of supply chain dislocations, fast and hard rate hikes won’t be enough if Chinese production does not get back into top gear. Such considerations are why investors expecting the US dollar to strengthen against the yuan may be disappointed.

15 Feb 2022 - 4:30PM
Macroscope | Oil prices will remain high as China’s economy starts to fire on all cylinders again

China’s economic activity has slowed amid headwinds from the Lunar New Year, Winter Olympics and the ongoing ‘dynamic zero infection’ strategy. Once China’s economy returns to form, though, it will fuel further rises in oil prices that are already at a seven-year high.

China’s economic activity has slowed amid headwinds from the Lunar New Year, Winter Olympics and the ongoing ‘dynamic zero infection’ strategy. Once China’s economy returns to form, though, it will fuel further rises in oil prices that are already at a seven-year high.

8 Feb 2022 - 2:30PM
Macroscope | Forex investors are well placed to profit from divergent US and Chinese monetary policies

While a narrowing yield differential would normally make the renminbi less attractive, China’s economic heft and increasing trade surplus support a strong currency. The trend of rising global energy and commodities prices should also be on investors’ radar with regards to currencies of producer countries.

While a narrowing yield differential would normally make the renminbi less attractive, China’s economic heft and increasing trade surplus support a strong currency. The trend of rising global energy and commodities prices should also be on investors’ radar with regards to currencies of producer countries.

26 Jan 2022 - 6:45AM
Macroscope | Real-world limits will keep Fed interest rate rises moderate, and the markets know it

The spike in US inflation has seen the Fed turn hawkish, but do not expect a return to the all-out campaign against rising prices of the Volcker years. In Hong Kong, where CPI is way below the US inflation rate, but whose monetary policy must track the US’, this approach will suit it just fine.

The spike in US inflation has seen the Fed turn hawkish, but do not expect a return to the all-out campaign against rising prices of the Volcker years. In Hong Kong, where CPI is way below the US inflation rate, but whose monetary policy must track the US’, this approach will suit it just fine.

19 Jan 2022 - 4:24AM
Macroscope | How dollar peg and mainland inflation policy will help Hong Kong keep price rises in check

Hong Kong consumers will not be totally spared from rising prices as policy decisions at home and elsewhere take effect. Even so, Beijing’s commitment to curbing inflation and the Hong Kong dollar’s reliable peg should insulate the city from the worst effects.

Hong Kong consumers will not be totally spared from rising prices as policy decisions at home and elsewhere take effect. Even so, Beijing’s commitment to curbing inflation and the Hong Kong dollar’s reliable peg should insulate the city from the worst effects.

11 Jan 2022 - 2:30PM
Macroscope | How China’s zero-Covid strategy helps US dollar strength but hurts Asian currencies

While Washington is living with the virus and tightening policy, Beijing sticks with its approach and seeks monetary policy support. This underpins the US dollar’s value versus the yuan at the same time as its spillover effects drive weakness in other Asian currencies.

While Washington is living with the virus and tightening policy, Beijing sticks with its approach and seeks monetary policy support. This underpins the US dollar’s value versus the yuan at the same time as its spillover effects drive weakness in other Asian currencies.

4 Jan 2022 - 2:30PM
Macroscope | Why China’s 2022 economic outlook is more upbeat than investors may think

China’s economy will face continuing problems in the property sector, costs from its zero-Covid strategy, slowing exports and factory closures. Even so, most of the issues stem from conscious and presumably well-considered decisions by policymakers.

China’s economy will face continuing problems in the property sector, costs from its zero-Covid strategy, slowing exports and factory closures. Even so, most of the issues stem from conscious and presumably well-considered decisions by policymakers.

28 Dec 2021 - 12:30PM
Macroscope | Why China is seeking a weaker yuan as the US and UK take a more hawkish monetary policy stance

The Fed and Bank of England tilt is in stark contrast to the dovish tone from Beijing, where recent People’s Bank of China decisions suggest to currency markets that officials would rather not see the yuan continue to strengthen.

The Fed and Bank of England tilt is in stark contrast to the dovish tone from Beijing, where recent People’s Bank of China decisions suggest to currency markets that officials would rather not see the yuan continue to strengthen.

21 Dec 2021 - 2:30PM
Macroscope | Why China should worry about food price inflation despite November’s modest rise

Plummeting pork prices have helped offset increases in other foods, but with the rising cost of food a global issue – and high energy prices that will hit food production – Beijing officials can’t afford to rest easy

Plummeting pork prices have helped offset increases in other foods, but with the rising cost of food a global issue – and high energy prices that will hit food production – Beijing officials can’t afford to rest easy

15 Dec 2021 - 6:45AM
Macroscope | How US-China monetary policy split could drive dollar gains against the yuan

While the US central bank is waking up to the need to respond to rising inflation, China looks set to stick with supportive monetary policy. If this divergence continues, it could erode the yield differential that currently favours the renminbi over the US dollar.

While the US central bank is waking up to the need to respond to rising inflation, China looks set to stick with supportive monetary policy. If this divergence continues, it could erode the yield differential that currently favours the renminbi over the US dollar.

8 Dec 2021 - 2:13AM
Macroscope | Why the Japanese yen rally may not last even if worries over the Covid-19 variant Omicron persist

The yen’s safe-haven status explains why investors favour it in times of uncertainty, but greed will overtake fear. The interest rate differential against Japan’s currency, which increases the cost of holding yen, and the continuing weakness of the Japanese economy will reassert themselves.

The yen’s safe-haven status explains why investors favour it in times of uncertainty, but greed will overtake fear. The interest rate differential against Japan’s currency, which increases the cost of holding yen, and the continuing weakness of the Japanese economy will reassert themselves.

30 Nov 2021 - 2:30PM
Opinion | Why US-China oil reserve release won’t fix deeper demand-supply problems

Oil supply will remain tight as investors turn away from hydrocarbons even as demand rises with pandemic recovery and the building of a renewable energy network.

Oil supply will remain tight as investors turn away from hydrocarbons even as demand rises with pandemic recovery and the building of a renewable energy network.

23 Nov 2021 - 2:30PM
Macroscope | US dollar strength just means renminbi bulls need to look further afield for yields

The US dollar is being supported by rising consumer prices and sentiment that the Fed might accelerate the tapering of its bond purchases. Investors seeking to benefit from yuan appreciation should look to Europe, Britain and Japan.

The US dollar is being supported by rising consumer prices and sentiment that the Fed might accelerate the tapering of its bond purchases. Investors seeking to benefit from yuan appreciation should look to Europe, Britain and Japan.

17 Nov 2021 - 1:30AM
Macroscope | COP26: even with Xi’s absence, China’s climate actions speak louder than words

Given China’s manufacturing heft, it is no surprise that it is the world’s biggest carbon emitter. But Beijing is also taking practical measures to transition to a carbon neutral economy, and inspiring other developing countries in the process.

Given China’s manufacturing heft, it is no surprise that it is the world’s biggest carbon emitter. But Beijing is also taking practical measures to transition to a carbon neutral economy, and inspiring other developing countries in the process.

9 Nov 2021 - 2:30PM
Macroscope | Why the wind behind the Chinese yuan’s strength is likely to die down in 2022

As yield differentials that previously favoured the yuan narrow, the currency market might see more reasons to favour countries such as the US that have tightened monetary policy, and, by extension, fewer reasons to hold the renminbi.

As yield differentials that previously favoured the yuan narrow, the currency market might see more reasons to favour countries such as the US that have tightened monetary policy, and, by extension, fewer reasons to hold the renminbi.

2 Nov 2021 - 11:25PM
Macroscope | Japanese yen faces a long slide as currency markets ignore official warnings

The weaker yen is making Japan’s import bill worse, from energy to raw materials, amid supply bottlenecks. But there is little Japan can do to make currency markets listen in a global inflationary environment.

The weaker yen is making Japan’s import bill worse, from energy to raw materials, amid supply bottlenecks. But there is little Japan can do to make currency markets listen in a global inflationary environment.

27 Oct 2021 - 5:30AM
Macroscope | China’s coal rush: why the West has no business judging Beijing

China is committed to carbon neutrality by 2060 but in the short term, Beijing simply has to address an energy shortfall and keep the lights on. By moving manufacturing to China, the West has offshored some of its carbon emissions. It is not in a position to criticise Beijing.

China is committed to carbon neutrality by 2060 but in the short term, Beijing simply has to address an energy shortfall and keep the lights on. By moving manufacturing to China, the West has offshored some of its carbon emissions. It is not in a position to criticise Beijing.

20 Oct 2021 - 2:41AM