Financial Markets…U.S. Treasuries slid for the first time in four days, with the benchmark note yields 3 basis points to 1.62%, as a government report showed U.S. employers added more than forecasted jobs in November. U.S government bonds have advanced 2.8% this year as of yesterday, after gaining 9.8% in 2011 and 5.9% in 2010.
The World Bank released its latest Quarterly Update on China’s economy on Friday (for disclosure's sake: I’m the lead author). At the press launch, there were a lot of questions about the recent wage hikes in several foreign-owned manufacturing companies and the possible concerns these have triggered among many about possible loss of competitiveness and/or a wage-inflation spiral.
Just as Asian economies started to recover from the global recession, policymakers and markets have started to worry about unwarranted asset price increases.
The Mexican central bank's latest data release shows that remittances to Mexico increased by 13 percent in October on a year-on-year basis. This comes after a widely-reported 12 percent year-on-year drop in August and (less widely reported) flat growth in September.
A recent AP article attributes this increase to the depreciation of the Mexican Peso against the U.S. dollar:
The question of whether China is overwhelmed by capital inflows has been asked for quite a while now. If a question continues to be asked, there is probably a good reason for it. Whether the answer is yes or no depends on how you look at it.