My subscription
My Subscription All Publications

Testing, testing, testing

The outlines of a new, more stringent zero-COVID approach are emerging in China, in the wake of the failure to control infections in Shanghai. If successful, there should be less supply chain disruption than has been seen recently. But greater vigilance will prevent much service sector activity returning to normal. Meanwhile, there is no sign in real-time data on construction activity of any infrastructure push getting underway.
Julian Evans-Pritchard Senior China Economist
Continue reading

More from China

China Data Response

China Consumer & Producer Prices (Jul.)

Consumer price inflation rose to a 24-month high in July and is now nearing the government’s target of 3%. But that is still very low by global standards, and we think headline inflation is close to a peak and will drop back over the coming quarters. Meanwhile, producer price inflation fell to its lowest in 17 months.

10 August 2022

China Data Response

China Trade (Jul.)

Exports held up well last month, thanks to a backlog of orders still being cleared. But it won’t be long before shipments drop back on cooling foreign demand. Meanwhile, imports continued to trend down, pointing to further domestic weakness.

8 August 2022

China Economics Weekly

Taiwan tensions add impetus to decoupling

If China’s military drills off the coast of Taiwan end, as scheduled, on Sunday and there is no further retaliation, this week’s flare-up in tension won’t have a direct economic impact. But it will have added urgency to efforts by China to make its economy less vulnerable to the sanctions that could follow a full-blown cross-Strait crisis. And it should have added impetus to efforts by multinationals to prepare for that eventuality too. We are re-sending this publication due to an error with the previous email. We apologise for any inconvenience caused.

5 August 2022

More from Julian Evans-Pritchard

China Data Response

China Bank Lending & Broad Credit (Apr.)

Lending was much weaker than expected last month as lockdowns weighed on credit demand. This should nudge the PBOC to announce further easing measures soon. But the central bank continues to signal a relatively restrained approach.

13 May 2022

China Economics Update

No good options

Officials are struggling to balance a raft of conflicting goals spanning everything from GDP growth, zero-COVID, exchange rate stability, deleveraging and regulation. We don’t expect much compromise on zero-COVID. In other respects, we expect a fudge: a temporary tempering of regulatory and credit concerns, and enough stimulus to prevent a deep slump. Our forecast for growth this year is 2%. If COVID can’t be controlled, even that isn’t guaranteed.

12 May 2022

China Data Response

China Consumer & Producer Prices (Apr.)

Consumer prices rose at a faster pace last month. But inflation remains relatively subdued and there are already signs in the producer price data of upstream price pressures easing. As such, inflation is unlikely to be a constraint on policy action by the PBOC.

11 May 2022
↑ Back to top