12th November 2025

MACRO

China Intervenes in SMIC Chip Distribution

Shortages of advanced semiconductors in China are so acute that the government has begun intervening in how the output of its largest contract chip maker, SMIC, is distributed. Chinese authorities are trying to give priority to the needs of tech conglomerate and national champion Huawei Technologies. In some cases, labs are smuggling coveted supplies of Nvidia chips. This underscores the severity of China’s chip supply crisis despite the recent US-China trade détente. (Wall Street Journal)

Fed Torn Over December Rate Cut

A Wall Street Journal Timiraos article notes that as data went dark, inflation hawks pushed to pause rate cuts at the contentious October meeting, and that the divide might not end soon. US regulators have agreed on terms to ease a set of capital requirements (supplementary leverage ratio) that could potentially allow banks to hold more Treasuries. Federal Reserve Governor Michael Barr said there needs to be clear guardrails to prevent risks as the financial sector looks to adopt AI in its core functions. (Wall Street Journal, Bloomberg)

Trump Admin Unveils Offshore Drilling Plan

The Trump administration is poised to unveil a plan that would allow oil drilling off the California coast, a move likely to further inflame the political feud between the president and Democratic Governor Gavin Newsom. The announcement, which could come later this week, is also expected to include proposals for drilling around Alaska and the Eastern Gulf of Mexico. Trump is expected to host a private dinner at the White House Wednesday with several top business executives, including the CEOs of Nasdaq and JPMorgan Chase. (Wall Street Journal, Reuters)

Japan Manufacturing Confidence Surges

Japanese manufacturing confidence surged to its highest level in nearly four years in November, led by the electronics and auto sectors which have been buoyed by yen softness and solid orders. Japan’s Nikkei share average rose slightly Wednesday, with losses in SoftBank countering gains in some AI-theme stocks, while Sony Group helped the broader Topix notch a fresh high on robust annual profit forecast. PM Takaichi said in parliament she “strongly hopes” the central bank achieves inflation driven by wages rather than primarily through rising food costs, signaling her administration’s preference for interest rates to stay low. (Reuters)

China’s Economic Challenges Mount

Banks in China are asking clients to take out loans and then immediately repay them, with the bank covering the interest, in a practice known as “quick-lend-and-recover” in efforts to hit government-set targets that can’t be met by real demand. China’s banks are listing more properties online for sale this month to accelerate disposal of non-performing assets. Chinese authorities stepped up efforts to collect taxes from citizens with overseas investment income as part of a broader push to suppress cross-border trading that evades capital controls. Global lenders like Goldman Sachs retracted calls for further monetary stimulus in China this year after the central bank telegraphed more patience in steering an economy still on track to hit growth targets. (Bloomberg, Shanghai Securities News)

UK Budget Preparations Intensify

UK business chiefs urged Chancellor Reeves to ease energy costs and avoid raising the tax burden on corporate Britain as she prepares this year’s budget. UK Health Secretary Wes Streeting denied plotting to oust PM Keir Starmer, but launched a series of sharp criticisms about the British leader’s political operation. France’s central bank is likely to raise growth forecasts for this year and next as the economy continues to show resilience to political turmoil. (Bloomberg)

Asia-Pacific Central Bank Signals

RBA’s Hauser said there was increasing debate about whether the current cash rate of 3.6% is restrictive enough to keep inflation in check, adding the question is critical for the policy outlook. Australian home loans surged beyond expectations in Q3 to a record high, underscoring how easier monetary policy has reignited credit growth and property demand. Bank of Korea Governor Rhee signaled that while the central bank remains in an easing cycle, the timing and size of any future rate moves may shift depending on forthcoming data. (Reuters, Bloomberg)

GEOPOLITICAL

China Builds Shadow Fleet for Russian Gas

China is stepping up its efforts to import US-sanctioned Russian gas, building the beginnings of a domestic “shadow fleet” of vessels that can transport the super-cooled fuel and circumvent restrictions imposed on one of the Kremlin’s flagship industries. The US Navy’s largest aircraft carrier arrived in waters near Latin America Tuesday, expanding the American military’s buildup as the Trump administration seeks to ratchet up pressure on Venezuelan President Maduro. (Bloomberg, Wall Street Journal)

China-Japan Tensions Escalate

A spat between China and Japan over Japanese Premier Takaichi’s Taiwan comments showed no signs of abating Wednesday after a series of vitriolic articles in Chinese state media and calls in Tokyo to expel a Chinese diplomat. Australia’s spy chief warned Wednesday that hackers working for the Chinese government and military had probed Australia’s telecommunications network and critical infrastructure, warning of potential economic disruption if a sabotage attack were carried out. (Reuters)

EQUITIES

GM Orders Suppliers to Scrub China Parts

General Motors has directed several thousand of its suppliers to scrub their supply chains of parts from China, reflecting automakers’ growing frustration over geopolitical disruptions to their operations. This represents a significant escalation in supply chain decoupling efforts. (Reuters)

JPMorgan Rolls Out Digital Deposit Token

JPMorgan Chase has started rolling out a deposit token called JPM Coin to institutional clients, a move that comes as financial institutions continue to broaden their footprint in digital assets. Alphabet’s Google is partnering with Turkey’s largest mobile operator to build the first hyperscale data center in the country. Bill Holdings, the business-payments firm under pressure from activist investor Starboard Value, is exploring options including a potential sale. (Bloomberg)

Huawei Plans to Double AI Chip Capacity

Huawei plans to more than double its total AI chip capacity by next year, according to Wall Street Journal sources. This comes as the Chinese government prioritizes Huawei’s access to SMIC’s limited advanced chip output. Rising DRAM memory chip prices mean Asustek Computer (ASUS) will have to hike prices on its electronics, with Co-CEO Samson Hu saying rising DRAM prices are trouble for all PC makers. (Wall Street Journal, Liberty Times Net)

Singles’ Day Shows Strong Results

JD.com said orders surged nearly 60% during this year’s Singles’ Day event, though it didn’t disclose transaction values. The company also reported a 40% increase in shoppers, compared with a more than 20% rise last year. China’s Singles’ Day sales festival is coming to a close after more than a month of promotions on the country’s largest e-commerce platforms. (Bloomberg, Reuters)

Hong Kong IPO Pipeline Builds

Zhongji Innolight, a Chinese maker of optical communication modules and devices, has picked banks for a Hong Kong listing that could raise $3 billion or more. Chinese discount online retailer Vipshop Holdings is considering a listing in Hong Kong as soon as next year. Hisense Group Holdings is considering options for its consumer electronics and home appliances units, including a possible merger. (Bloomberg)

Foxconn Beats on AI Server Demand

Foxconn Technology Group reported better-than-expected net profit as the Nvidia supplier continued to ramp up AI server shipments thanks to the AI boom. The company said that 2026 “looks very good.” TSMC’s share price has surged due to demand for AI, putting some fund managers at risk of underperforming due to restrictions on portfolio concentration. (Wall Street Journal, Bloomberg)

European Corporates Mixed

Infineon Technologies expects sales to grow in the new fiscal year as demand for chips powering AI data centers keeps booming, while appetite for other semiconductors used in cars, industrial machinery, and consumer electronics remains subdued. Bayer posted better-than-expected quarterly profit, helped by demand for new medicines and corn seeds. Taylor Wimpey, one of Britain’s biggest housebuilders, warned that uncertainty about potential tax changes in the upcoming November budget is weakening the housing market. (Wall Street Journal, Bloomberg)

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