China Official PMIs (May)

The latest surveys suggest that stronger construction activity nudged up overall growth this month and that supply shortages are pushing up prices even as final demand for manufactured goods appears to be levelling off.
Julian Evans-Pritchard Senior China Economist
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China Data Response

China Trade (Nov.)

Exports and imports beat expectations last month thanks to stronger demand and easing semiconductor shortages. In the near-term, the emergence of the Omicron variant is likely to support demand for China’s exports. But its impact further ahead is still uncertain. Meanwhile, we doubt the latest uptick in imports is the start of a sustained rebound given that property construction looks set to weaken further.

7 December 2021

China Economics Update

RRR cut today, rate cuts tomorrow?

The People’s Bank (PBOC) has just announced a cut to the required reserve ratio (RRR) for most banks, shortly after Premier Li and the Politburo each separately hinted at an increase in policy support. There is already evidence of fiscal easing, and we expect policy rate cuts from the PBOC before long. That said, there still appears to be little appetite at the central bank for a sharp rebound in credit growth, and we’re seeing an opening of the fiscal taps, not a flood. This easing will cushion but not stop growth from slowing. Drop-In: China trade and the commodities demand outlook 08:00 GMT/16:00 HKT, Tuesday 7th December https://event.on24.com/wcc/r/3546145/A9D34EF592141BEFCAC819ADB40359D5?partnerref=report  

6 December 2021

China Economics Weekly

Year-end policy bash to strike a more dovish tone

The upcoming Central Economic Work Conference in Beijing is likely to signal that policy is turning more supportive. But loosening will be measured, and growth over coming quarters will still slow.

3 December 2021

More from Julian Evans-Pritchard

Long Run Update

Employment already declining at pace

Revisions to the historic data following the recent census show that China’s population barely grew last year and that employment is already contracting faster than previously understood, having peaked in 2014 rather than 2017. The silver-lining, however, is that the new data suggest that productivity growth has slowed by less and that there is greater scope to counter demographic headwinds by boosting participation rates over the coming decades.

1 July 2021

China Data Response

China Caixin Manufacturing PMI (Jun.)

The Caixin manufacturing index published today dropped back last month and adds to signs from the official PMI released yesterday that momentum in industry is waning. The surveys point to a levelling off in demand and easing of price pressures, even as supply shortages continue to constrain output.

1 July 2021

China Chart Book

No, China isn’t exporting inflation

Some believe that China is adding to global inflationary pressure. The opposite is closer to the truth: the large increase in China’s trade surplus over the past year signals that supply from China has risen far more than demand. Global consumer goods prices are rising in spite of China, not because of it. Admittedly, China’s rapid, investment-intensive recovery has been an important factor in the rise in global commodity prices over the past year – this is the key reason why China’s producer price inflation hit a 12-year high last month. But China’s contribution to the surge in global demand for consumer durables has been relatively small – unlike in many major economies, retail spending on goods in China is not particularly strong. And while dollar prices of goods from China have risen over the past year, these price hikes have generally failed to keep up with the pace of renminbi appreciation. In renminbi terms, export prices have been falling unusually fast.

30 June 2021
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