Let's get to us. She's chat our guest for the half hour. She is founder also the CEO at Crystal. He joins from Singapore. Thanks for being with us. We're still trying to kind of look at the fallout from this employment report. We've talked about the overall job growth. Wage growth was also much above forecast, so they're obviously inflationary pressures building on that front. We're going to get
the CPI data this week. We also have from the Chinese perspective, a lot of inflation numbers we're going to be sorting through midweek. Are we near peak inflation right now? Or do you think we have a while to go? But it looks like we have a while to go, and a lot of data is going to come out
this weekend next that will give us some indicators. But even if the data is let's say, a good wollatial on either side, and just like you have the non Bompado's much much above expectations, I still think the Fed is on its course to achieve close to a four per cent bind of the year. So certified BP seems like a done deal. Inflation does not seem to be well under control. Yes, you will have the base effect coming in, you will have certain energy items probably tapering
a bit in terms of inflation. But I don't think we're out of the words yet. Do you have a sense of about when we might be out of the woods? When do you think inflation might peak? Where do you see that funds right settling? So I think that the right course of action or what the FED is probably thinking. And this is a guess. What make is that as you have a few rate hikes or certified PP coming in, it takes a quarter or two for the effects to
seep in. So I think when you see the Q three results coming in, when you see the base effect coming in, it's likely to be Q four and that's when you could see a solid sign of inflation tapering. And that's the only way you would have a FED slowing down the pace of hikes. So I would say that seventy five fifty is what the FED may be thinking to achieve a four percent rather than seventy five
centive and go about bob Board. And yet we have this inversion in the treasury curve which would imply that we're dealing with an impending recession. How do you square the two Clearly the bond market is saying that the FED is going to go overboard because they are predicting that FED is likely to not have inflation under control
and hit the brakes very hard. So while there is a segment of the market at least the equities market is looking at the Goldilocks is back kind of scenario because you think that FED is engineering a good soft landing. But there is the bond market saying that, no, the FED has it wrong. Neither do they health control over inflation, and if they do manage to get some control over it, recession will be staring in our face. So they're clearly
sending up very different message than the equities. All right, So where do you put money to work in this environment? Is there anything out there that's flashing a bye for you right now? So clearly short term bonds. We know that the rate is likely to be somewhere in the three and after four percent by the end of this year, and that's probably likely to happen, So so short term
bonds is the safest play to go for. But otherwise on that also you still need to keep an exposure to commodities, maybe lower than before, but definitely need to be in as an inflation hedge, and she Sho want to turn our attention now to China and particularly that very impressive trade data we head out over the weekend. Exports growing eight hundred one billion dollar trade surplus. A lot of hyperens though in China. How sustainable does this
look to you? So we have big advocators of value coming out of China in terms of investing in their great markets there. Having said that, the data that has come out it is quite positive on the on the export side, and on imports it's a bit lower. It's just a signal of front loading of orders given the COVID related lockdowns that we're seeing there. But clearly there is a positivity to the economy that could come out after the October Congress that happens there. However, there is
the geopolitical risks that is overshadowing it. There is the whole mortgage related cloud that is also over there. But we think that for October you would see or you should see policy actions that would give a very positive momentum to the economy. So what are you singing then or predicting in the way of stimulus. So it's tough to say what exactly do they come out with, because
they have kind of underwhelmed from the market expectations. But clearly a stimulus that leads to clearing of the clouds on the mortgage crisis and showing more easy stands is something that may be needed and that's what the market would look for. But as the uncertainty goes away, you would see that the focus will come on valuations and from a value perspective, it would look very attractive. So
where do you put money to work? In China? Are there any particular sectors or stocks that look appealing to you at the moment. So we'll go with the broad index names, you know, the China ashes, rather than specific in tech or so. Of course avoiding property is prudent, but going with the broad index names is what we it would typically stick to. So much of the conversation has been around technology as well at Taiwan, the semiconductor industry.
That's also a part of the South Korea story. Would you be tempted to put money away from China in certain pockets of the a pack that had to deal with technology, particularly the semiconductors, rather than some of the hardware names. It's definitely tempting, but we don't know whether this is going to be just a short term trend or a short term nijor reaction in the technology space. We still think that the U s pictech is well positioned despite all the rate hikes, and that's where I
think buying going dips is likely to continue. So would rather go safe that we have clarity on the monetary policy actions and inflation. We have, of course seen some fairly active Chinese military drills around Taiwan following the visit of House Speaker Nancy Pelosi. How does the balance of excuse me, risks here look to you? Is it? Are there any risks for markets for growth or does this just look like domestic political cyber rattling. No, there's definitely
geopolitical risk that one has to keep in mind. But given the priorities that the Chinese government would have, I would think that the importance to these should be lowered. I wouldn't comment on any any political moves that could happen at per se, but hoping that whatever is the impact of this is limited to certain import items or
certain export items from Taiwan and stays there. The domestic story in China has always been I think a concern for people that play the equity market on the mainland, I mean very soft kind of consumer participation. You mentioned that the difficulty with the property market is being a contributor to that fact. Are you sensing a turn in in consumer sentiment or at least consumer behavior in China. Yeah, the domestic demand definitely has taken a double blow, both
in terms of property as well as coordulated effects. And as the policy gets a bit easier on the COVID side as well as any physical stimulus comes helping the property sector, that's where we think the sentiment could improve, but we're still at least three to four months away from that happening very quickly. Is she short's your cash allocation like at the moment? So instead of cash, we prefer holding short term in western grade bonds because that's going to give you a lot more return banko back
than anything else. Alright, as she ship Chanda, founder and CEO at Crystal, Thanks so much for joining us here on Bloomberg Daybreak. Asion