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Asia Drop-In: Is China in a balance sheet recession?

Widespread angst around China’s growth outlook is fuelling a debate about whether the economy is in the kind of “balance sheet recession” that typified Japan’s experience in the 1990s.

In our latest briefing on the big macro and market themes in the Asia region, our economists discussed the macro risks around signs that China’s households and firms are starting to follow their Japanese peers.

They also gave their latest assessment of the region’s growth and policy outlooks and preview the following day’s Bank of Japan meeting. During this 20-minute briefing, the team addressed key issues, including:

  • The “balance sheet recession” debate and implications for China’s economic and policy outlooks;
  • Whether the Bank of Japan will decide to tweak its Yield Curve Control policy;
  • What the Q2 data releases so far say about the region’s economic outlook.
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