oecd parliamentary days 2016 - finance and inclusive growth (part 2)
TRANSCRIPT
FINANCE & INCLUSIVE GROWTHMEETING OF THE OECD GLOBAL PARLIAMENTARY NETWORKFRIDAY 5 FEBRUARY 2016
Adrian Blundell-WignallSpecial Advisor on Financial Markets to the OECD Secretary General, & Director Financial & Enterprise Affairs Directorate.
2
Investment trends: Capex of non-financials firms in selected advanced economies
0
500
1,000
1,500
2,000
2,50020
02
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
US$, bn Utilities Telecom. ServicesInformation Technology HealthcareConsumer Staples Consumer DiscretionaryIndustrials MaterialsEnergy
3
Investment trends: Capex of non-financials firms in BRIICS
-30
-20
-10
0
10
20
30
40
50
60 %YoY CHINA
Energy Materials Industrials Utilities
-60
-40
-20
0
20
40
60
80
100
120 %YoY BRAZIL
-40
-20
0
20
40
60
80
100
120
140
160
180 %YoY INDIA
-60
-40
-20
0
20
40
60
80
100
120
140 %YoY INDONESIA
-60
-40
-20
0
20
40
60
80
100
120
140
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
%YoY RUSSIA
-30
-20
-10
0
10
20
30
40
50
60
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
%YoY SOUTH AFRICA
4
Investment trends: Capex of non-financials firms in advanced economies versus EMEs
-40-30-20-10
01020304050
%YoY ADVANCED ECONOMIES
Energy Materials IndustrialsConsumer Discretionary Consumer Staples HealthcareInformation Technology Telecom. Services Utilities
-30-20-10
01020304050607080
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
%YoY EMEs
5
Trends in prices of selected commodities
0
0.2
0.4
0.6
0.8
1
1.2
Jan-
12
Apr-
12
Jul-1
2
Oct
-12
Jan-
13
Apr-
13
Jul-1
3
Oct
-13
Jan-
14
Apr-
14
Jul-1
4
Oct
-14
Jan-
15
Apr-
15
Jul-1
5
Oct
-15
Jan-
16
Apr-
16
Jul-1
6
Oct
-16
INDEX
Iron Ore Copper AluminiumGold Oil Sugar
2012=100
6
Long-run commodity, oil prices & US Dollar
0
20
40
60
80
100
120
140
160
180
200
Jan-
70M
ar-7
2M
ay-7
4Ju
l-76
Sep-
78N
ov-8
0Ja
n-83
Mar
-85
May
-87
Jul-8
9Se
p-91
Nov
-93
Jan-
96M
ar-9
8M
ay-0
0Ju
l-02
Sep-
04N
ov-0
6Ja
n-09
Mar
-11
May
-13
Jul-1
5
Index 2010=100 $ Real TWINon-Rural Comm RealBrent Real
7
All in different places to respond
Brazil, Indonesia, South AfricaExch. C/A deficit, recession, outflows, inflationRate External Balance Fiscal deficit/past growth drivers Internal Balance
External shocks: commodities/China/$USEnergy/Materials invest. fallingUnder investment infrastructure/servicesSevere depreciationReserves: stable/moderate fallsRaising interest rates
Russia IndiaC/A surplus, recession, outflows C/A deficit post crisis, inflationLarge fiscal deficit Fiscal drivers-infrastructureExternal shocks:commodities/China/$US Private invest. weak most sectorsEnergy/Materials invest. falling Rapid money growthCurrency crisis/depreciation Targeted moderate depreciationReserves falling/stabilising Increasing forex reservesRaising interest rates China Consumer weakening
Super-cycle ending Stable interest ratesC/A surplus, OutflowsHigh saving/ investment/SOE roleFalling Co. investment/all sectorsRapid money growthLarge interventions stock exchangeTargeted moderate depreciationImposing capital outflow controls
INVESTMENT/AGGREGATE DEMAND
8
Total return indexes on various asset classes
0
50
100
150
200
250
300
350
400
450Ja
n-00
Aug-
00M
ar-0
1O
ct-0
1M
ay-0
2De
c-02
Jul-0
3Fe
b-04
Sep-
04Ap
r-05
Nov
-05
Jun-
06Ja
n-07
Aug-
07M
ar-0
8O
ct-0
8M
ay-0
9De
c-09
Jul-1
0Fe
b-11
Sep-
11Ap
r-12
Nov
-12
Jun-
13Ja
n-14
Aug-
14M
ar-1
5O
ct-1
5
Index (100 = Jan-2000)
US Tsy Tot Ret 10y GBI $ Tot Ret EMEsMSCI World Tot Ret S&P 500 Tot RetHFRI Weighted Index Tot Ret US Private EquityUS Real Estate Shanghai Equity Composite Index
9
Chinese stocks listed in Shanghai & Hong Kong
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
Mar
-12
Jun-
12
Sep-
12
Dec-
12
Mar
-13
Jun-
13
Sep-
13
Dec-
13
Mar
-14
Jun-
14
Sep-
14
Dec-
14
Mar
-15
Jun-
15
Sep-
15
Dec-
15
Price Ratio (Shanghai / Hong
Kong)Quartile 25 Median
Quartile 75
10
Onshore vs offshore RMB spread
-0.15
-0.10
-0.05
0.00
0.05
0.10
5.7
5.8
5.9
6.0
6.1
6.2
6.3
6.4
6.5
6.6
6.7
6.8
12-3
1-20
1002
-24-
2011
04-2
0-20
1106
-14-
2011
08-0
8-20
1109
-30-
2011
11-2
4-20
1101
-18-
2012
03-1
3-20
1205
-07-
2012
06-2
9-20
1208
-23-
2012
10-1
7-20
1212
-11-
2012
02-0
4-20
1303
-29-
2013
05-2
3-20
1307
-17-
2013
09-1
0-20
1311
-04-
2013
02-2
8-20
1404
-24-
2014
06-1
8-20
1408
-12-
2014
10-0
6-20
1411
-28-
2014
01-2
2-20
1503
-18-
2015
05-1
2-20
1507
-06-
2015
08-2
8-20
1510
-22-
2015
12-1
6-20
15
CNY spreadCNY Spread (RHS)
Offshore Deliverable CNY
China Renminbi Spot
11
Hong Kong RMB overnight interbank
0
10
20
30
40
50
60
70
80
12-1
2-20
1401
-01-
2015
01-0
1-20
1502
-09-
2015
02-0
2-20
1503
-09-
2015
03-0
3-20
1504
-02-
2015
04-0
4-20
1505
-04-
2015
05-0
5-20
1505
-05-
2015
06-1
1-20
1506
-06-
2015
07-0
8-20
1507
-07-
2015
08-0
3-20
1508
-08-
2015
08-0
8-20
1509
-10-
2015
09-0
9-20
1510
-08-
2015
10-1
0-20
1511
-04-
2015
11-1
1-20
1511
-11-
2015
12-1
1-20
1512
-12-
2015
01-0
8-20
16
% TMA ON CNH Hong Kong InterBank Offered Rate (CNH Hibor) Fixing
12
Exchange rates: BRICS vs TIGERS
0.4
0.5
0.6
0.7
0.8
0.9
1
1.1
1.2
Jan-
12
Apr-1
2
Jul-1
2
Oct
-12
Jan-
13
Apr-1
3
Jul-1
3
Oct
-13
Jan-
14
Apr-1
4
Jul-1
4
Oct
-14
Jan-
15
Apr-1
5
Jul-1
5
Oct
-15
Jan-
16
Apr-1
6
Jul-1
6
Oct
-16
INDEX
Yuan
Rupiah
Rand
Sing $
Won
Taiwan $
Rouble
Rupee
0.5
0.6
0.7
0.8
0.9
1.0
1.1
Jan-
12
Apr-1
2
Jul-1
2
Oct
-12
Jan-
13
Apr-1
3
Jul-1
3
Oct
-13
Jan-
14
Apr-1
4
Jul-1
4
Oct
-14
Jan-
15
Apr-1
5
Jul-1
5
Oct
-15
Jan-
16
Apr-1
6
Jul-1
6
Oct
-16
INDEX Jan 2012=1
SG$/yenyuan/yen$/yenwon/yenTW $/yenRup/yen
13
Effective exchange rates: China, Japan, Europe
70
80
90
100
110
120
130
140
12-3
1-20
1002
-23-
2011
04-1
8-20
1106
-09-
2011
08-0
2-20
1109
-23-
2011
11-1
6-20
1101
-09-
2012
03-0
1-20
1204
-24-
2012
06-1
5-20
1208
-08-
2012
10-0
1-20
1211
-22-
2012
01-1
5-20
1303
-08-
2013
05-0
1-20
1306
-24-
2013
08-1
5-20
1310
-08-
2013
11-2
9-20
1301
-22-
2014
03-1
7-20
1405
-08-
2014
07-0
1-20
1408
-22-
2014
10-1
5-20
1412
-08-
2014
01-2
9-20
1503
-24-
2015
05-1
5-20
1507
-08-
2015
08-3
1-20
1510
-22-
2015
12-1
5-20
15
Index(100 = Jan-2011)
Barclays Nominal Barclays Capital Effective Exchange Rate for the JPYBarclays Nominal Barclays Capital Effective Exchange Rate for the EURBarclays Nominal Barclays Capital Effective Exchange Rate for the CNY
14
Company long-term debt issues
0
500
1,000
1,500
2,000
2,500$US, bn Advanced Economies
Pre-crisis Debt
Post-crisis Debt
0
500
1,000
1,500
2,000
2,500$US, bn Emerging Economies
Pre-crisis Debt
Post Crisis Debt
15
Futures in crude being used to hedge untradeable HY energy debt
0
20
40
60
80
100
120
140
0
50
100
150
200
250
300
350
01-1
3-20
1402
-10-
2014
03-1
0-20
1404
-04-
2014
05-0
2-20
1405
-30-
2014
06-2
6-20
1407
-24-
2014
08-2
0-20
1409
-17-
2014
10-1
4-20
1411
-10-
2014
12-0
8-20
1401
-06-
2015
02-0
3-20
1503
-03-
2015
03-3
0-20
1504
-27-
2015
05-2
2-20
1506
-19-
2015
07-1
7-20
1508
-13-
2015
09-1
0-20
1510
-07-
2015
11-0
3-20
1512
-01-
2015
12-2
9-20
15
Index(100=Jan-2014)
Index(100=Jan-2014)
USD HY Energy OAS
Crude Oil Price (RHS)
16
World equity market capitalisation versus world GDP
30
40
50
60
70
80
90
100
110
120
Jan-
99M
ay-9
9Se
p-99
Jan-
00M
ay-0
0Se
p-00
Jan-
01M
ay-0
1Se
p-01
Jan-
02M
ay-0
2Se
p-02
Jan-
03M
ay-0
3Se
p-03
Jan-
04M
ay-0
4Se
p-04
Jan-
05M
ay-0
5Se
p-05
Jan-
06M
ay-0
6Se
p-06
Jan-
07M
ay-0
7Se
p-07
Jan-
08M
ay-0
8Se
p-08
Jan-
09M
ay-0
9Se
p-09
Jan-
10M
ay-1
0Se
p-10
Jan-
11M
ay-1
1Se
p-11
Jan-
12M
ay-1
2Se
p-12
Jan-
13M
ay-1
3Se
p-13
Jan-
14M
ay-1
4Se
p-14
Jan-
15M
ay-1
5Se
p-15
Jan-
16
% Share of WORLD market cap. in World nominal GDP (%)
17
Productivity levels & growth rates: Averages combining the decile rankings by sector
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
D1 D2 D3 D4 D5 D6 D7 D8 D9 D10
USD bln /1000 employees
Decile number
ADV Pre-crisis ADV Post-crisisEMEs Pre-crisis EMEs Post-crisis
-30
-20
-10
0
10
20
30
D1 D2 D3 D4 D5 D6 D7 D8 D9 D10
Compound %
Decile number
ADV Pre-crisis ADV Post-crisisEMEs Pre-crisis EMEs Post-crisis