A hint of optimism returns

<p>Kia ora,</p><p>Welcome to Monday’s Economy Watch where we follow the economic events and trends that affect Aotearoa/New Zealand.</p><p>I'm David Chaston and this is the international edition from Interest.co.nz.</p><p>Today we lead with news some unexpected optimism is creeping back into financial markets.</p><p>This week, the spotlight will be taken by US retail sales, producer price inflation, several housing indicators, and earnings reports for some large companies. Also, fresh inflation data will be released for the UK, Japan, Canada, and South Africa and monetary policy meetings will be held in Japan, Norway, Malaysia, and Indonesia. Finally, investors will be waiting for Q4 GDP growth, Industrial production, and retail sales data from China.</p><p>We should also note that tomorrow is Martin Luther King Day tomorrow in the US, so many markets there including the NYSE will be closed.</p><p>But first, China <a href="http://www.customs.gov.cn/customs/302249/zfxxgk/2799825/302274/302275/4794176/index.html" target="_blank"><strong>said</strong></a> its exports were -9.9% lower in December than the same month a year ago, a slightly worse result than anticipated. Its <a href="http://www.customs.gov.cn/customs/302249/zfxxgk/2799825/302274/302275/4794352/index.html" target="_blank"><strong>exports to the US</strong></a> were little-changed in value terms. It bought a lot less from Australia and a little less from New Zealand. But its exports to Australia were up strongly, and even more so to New Zealand. <a href="https://www.caixinglobal.com/2023-01-13/in-depth-chinas-nev-sales-took-off-in-2022-but-some-firms-pulled-way-ahead-101988956.html" target="_blank"><strong>Electric cars</strong></a> (Teslas and BYDs) drove those exports. Overall China's <a href="http://www.customs.gov.cn/customs/302249/zfxxgk/2799825/302274/302275/4794270/index.html" target="_blank"><strong>car exports</strong></a> are up +57% from year-ago levels.</p><p>Looking ahead, investors are turning bullish on China, looking past the immediate pa