China

China Data Response

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 overall inflation outlook remains benign, with PPI inflation likely to drop back around the turn of the year and CPI inflation set to remain muted for the foreseeable future.

14 October 2021

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 supportive in response to strains in the property sector. But the usual lags mean that tight credit conditions will remain a headwind to economic activity for a while.

13 October 2021

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 has largely been confined to a few energy-intensive industries and did not hold back wider manufacturing activity as many had feared.

13 October 2021
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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 a sharp rebound in services activity, which is probably enough to ensure that overall economic output picked up this month, partially reversing a sharp decline in August.

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 property sector appear to be intensifying.

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 the usual lags mean that tight credit conditions will remain a headwind to economic activity in the near-term.

10 September 2021

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 consumer goods is easing. Coupled with continued declines in food prices, this dragged consumer price inflation back below 1%. We think PPI inflation is likely to ease before long while CPI inflation will remain muted this year.

China Data Response

China Trade (Aug.)

Exports and imports were much stronger than anticipated last month thanks to buoyant demand, even as the data point to some lingering supply shortages. We continue to think shipments will soften in the coming quarters

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