China Economics Update Pullback in easing expectations overdone The Loan Prime Rate (LPR) remained on hold for the 18th straight month today. And investors have recently pared back their expectations for monetary easing. But given growing economic strains... 20th October 2021 · 3 mins read
China Data Response China GDP (Q3), Activity & Spending (Sep.) In q/q terms, official GDP growth slowed to a crawl last quarter. And our China Activity Proxy points to a sharp contraction. Although some of the recent weakness in services is now reversing... 18th October 2021 · 3 mins read
China Economics Weekly Property downturn deepens, triggering easing Supply-side disruptions mean there is an unusual amount of uncertainty about China’s recent economic performance. But one thing that’s clear is that the property sector downturn has gathered pace in... 15th October 2021 · 7 mins read
China Data Response China Consumer & Producer Prices (Sep.) Producer price inflation reached a new high last month due to the surge in global coal prices. There are few signs that this is feeding through to higher output prices of consumer goods, however. The... 14th October 2021 · 3 mins read
China Data Response China Bank Lending & Broad Credit (Sep.) Broad credit growth continued to slide in September and is now at its slowest pace since December 2005. We think credit growth will level off in the coming quarters, as PBOC policy turns more... 13th October 2021 · 2 mins read
China Data Response China Trade (Sep.) September exports beat even our above-consensus expectations. Coupled with separate data showing that electricity consumption held up well last month, this suggests that the hit from power rationing... 13th October 2021 · 3 mins read
China Economics Weekly Power cuts and inflation, zero-COVID hobbling tourism The coming week may shine a light on the global impact of China’s power shortages. There are reports of them triggering sharp falls in shipping costs. The producer price data on Thursday will show... 8th October 2021 · 6 mins read
China Chart Pack Power shortages another blow to global supply chains We still don’t have enough data to judge the extent of the disruption to China’s factory output from power rationing with much certainty. But with supply chains already stretched, even a modest hit to... 30th September 2021 · 13 mins read
China Data Response China PMIs (Sep.) The manufacturing PMIs diverged this month. But the big picture is that industry was coming off the boil even prior to the latest power shortages. On a more upbeat note, the official surveys point to... 30th September 2021 · 4 mins read
China Economics Weekly Local governments prepare to step in Evergrande creditors face a bumpy few weeks with a string of bond coupon payments due. Even if the company can scrape together the cash – not at all certain, given that it just missed one payment... 24th September 2021 · 6 mins read
China Economics Update LPR cuts appear imminent Commercial banks left the Loan Prime Rate (LPR) on hold for a 17th consecutive month today. But with the economy losing steam and concerns around the property sector growing, we think policy rate cuts... 22nd September 2021 · 2 mins read
China Economics Weekly Property sector leverage, China’s CPTPP bid Evergrande is the poster child for the excesses of China’s property sector, and its short-term liabilities are particularly high. But the sector is full of similarly-leveraged peers. Indeed, nearly... 17th September 2021 · 5 mins read
China Data Response China Activity & Spending (Aug.) The hit to service activity from last month’s virus outbreak was even larger than we, and other forecasters, had anticipated. The rest of the economy held up better, although the headwinds facing the... 15th September 2021 · 3 mins read
China Data Response China Bank Lending & Broad Credit (Aug.) Credit growth dropped in August to its slowest pace since December 2018. With the PBOC now shifting gears to a slightly more supportive stance, credit growth may level off in the coming quarters. But... 10th September 2021 · 2 mins read
China Economics Weekly Evergrande credit risks, border controls China’s banking system has large enough capital buffers to absorb an Evergrande collapse provided that the PBOC steps in to backstop the interbank market. Meanwhile, the one-sided reopening of the HK... 10th September 2021 · 5 mins read
China Data Response China Consumer & Producer Prices (Aug.) Producer price inflation reached its highest since August 2008 last month due to the rally in global commodity prices. But the breakdown suggests that upward pressure on the factory-gate prices of... 9th September 2021 · 3 mins read
