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China’s economy continued to recover in the first months of the new year. And we think fiscal support will keep supporting growth in the near-term. That said, the property sector remains a drag on the economy, and we expect a sharp downward adjustment in …
3rd April 2024
China’s economy has regained some strength recently. We expect this to continue over the coming months, on the back of support from fiscal policy and a further pick-up in household spending. But with property construction likely to continue to decline and …
29th February 2024
31st January 2024
This is a special Global Economics Chart Pack that provides clients with key analysis to make sense of the macro and market impact of the disruptions to maritime shipping. The charts in this document come from our brand-new shipping dashboard , which …
25th January 2024
China’s economy has regained some strength recently. We expect this to continue into 2024, on the back of support from fiscal policy and a further pick-up in household spending. But with property construction likely to continue to decline and exports set …
28th December 2023
China’s economy is making headway again after stalling during the summer. A step up in policy support looks set to deliver a modest cyclical recovery but trend growth remains under pressure. … China Chart Pack (Nov. …
28th November 2023
China’s economy is regaining some momentum after stalling during the summer. A step up in policy support looks set to deliver a modest cyclical recovery but trend growth remains under pressure. … China Chart Pack (Oct. …
30th October 2023
China’s economy is regaining some momentum after stalling during the summer. A step up in policy support looks set to deliver a modest cyclical recovery but trend growth remains under pressure. … China Chart Pack (Sep. …
28th September 2023
China's reopening recovery has fizzled out and the economy is now at risk of a downward spiral. We think policymakers will provide enough stimulus to avoid this and deliver a modest reacceleration in growth over the coming quarters. But most of the …
31st August 2023
China's reopening recovery has fizzled out and the economy is now at risk of slipping into a recession. We think policymakers will provide enough stimulus to avoid this and deliver a modest reacceleration in growth over the coming quarters. But most of …
31st July 2023
China’s reopening recovery is struggling for momentum and quarter-on-quarter growth will be subdued for the rest of the year. But with policymakers likely to step up support soon, the economy should still make some headway. … China Chart Pack (Jun. …
30th June 2023
The renminbi strengthened sharply against the US dollar in response to China’s move away from zero-COVID. But the currency has since reversed much of those gains and is now approaching 7.10/$, its weakest level since December. Optimism over China’s …
30th May 2023
The renminbi surpassed the US dollar to become the most-commonly-used currency in China’s cross-border transactions for the first time last month. Part of the increase – the part that has received plenty of attention – is due to wider adoption of renminbi …
27th April 2023
Consumer spending jumped during the first two months of the year as virus disruptions faded. The March retail sales data won’t be published for another couple of weeks. But the data we have so far suggest that the consumer recovery remained uneven last …
3rd April 2023
Local governments have stepped up their borrowing since the start of the year. They issued RMB860bn in special bonds over the course of January and February, up from an average of RMB105bn per month during the second half of 2022. Special bonds are …
28th February 2023
The Lunar New Year holiday wasn’t quite back to normal this year as fears of spreading COVID to elderly relatives prevented many households from returning to their hometowns – long-distance journeys, while the highest since the start of the pandemic, …
30th January 2023
It is three years since a cluster of cases of severe pneumonia started to draw attention in Wuhan. Chart 1 maps economic developments in China since then. The blue bars show cumulative growth since the end of 2019 and the black outlines show growth over …
4th January 2023
Concrete signs of an effort to exit from zero-COVID are emerging, with a notice today of a push to vaccinate the elderly. The low level of vaccine coverage of the most vulnerable is, along with a lack of healthcare capacity, the major constraint on …
29th November 2022
On some measures China’s current COVID situation is about as bad as it has ever been. While far fewer infections are being found daily than at the peak of the Omicron wave, new cases are geographically spread just as wide, with the result that the …
1st November 2022
It has been five years since the People’s Bank last dipped into its own foreign exchange reserves on a significant scale to support the currency. Since then, it is widely believed …
3rd October 2022
The renminbi has weakened 2.5% against the US dollar since mid-August and is nearing our year-end forecast of 7.00/$. This is mostly a reflection of broad dollar strength – the …
31st August 2022
The mortgage boycotts are a double threat to developers and to the housing market. They have drawn attention to the problem of cash-strapped developers being unable to complete properties that they have already sold, which is putting off new homebuyers. …
27th July 2022
The Omicron virus wave in China appears to have eased global shipping bottlenecks rather than worsened them as many had feared. Firms were able to re-route shipments through other ports to avoid disruption in Shanghai. And weaker goods demand domestically …
28th June 2022
China’s beleaguered property developers may soon see some respite both from their inability to borrow at reasonable rates and from sliding property sales. Last week, PBOC Governor said that the government would “correct the contraction in credit to …
30th May 2022
President Xi has reportedly told officials to ensure that China’s real GDP growth exceeds that of the US this year. This is likely to happen on paper. The published data usually confirm that growth targets have been met and the official target this year …
29th April 2022
Efforts to stabilise China’s financial markets have been a short term success. Although in aggregate March was one of the worst months on record for portfolio outflows from onshore markets, there were signs of a shift after Vice Premier Liu He’s promise …
31st March 2022
As well as a geopolitical quagmire for China’s leadership, the Russia-Ukraine conflict has become a headache for the PBOC. It has been signalling its dissatisfaction with the strength of the renminbi in recent months. But the renminbi is one of very few …
28th February 2022
Millions of people traditionally travel across China to spend this evening, the eve of Lunar New Year, with their families. The tradition has been severely disrupted by the pandemic. Last year, amid a flare-up in COVID infections, local governments …
31st January 2022
The People’s Bank purchased nearly $6bn in foreign exchange last month, by our estimate. That’s not much in the context of China’s cross-border trade and investment flows. But it was the biggest purchase in six years. Then, earlier this month, while …
22nd December 2021
The global spread of a more transmissible COVID variant is a particular challenge for a country trying to remain COVID-free. But after nearly two years of success suppressing infections domestically (see Chart 1), the bar to changing course before better …
29th November 2021
Despite a flurry of media reports in September hinting at widespread disruption, the data suggest that China’s recent power shortages have not been too severe. Electricity output actually rose 0.6% in seasonally-adjusted m/m terms last month, the fastest …
29th October 2021
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 output, which producers downstream might normally …
30th September 2021
A WeChat post by a prominent blogger voicing support for Xi Jinping’s “ common prosperity ” campaign has been widely re-published by state media, giving it a rare seal of Party approval. The post argues that the recent regulatory crackdown is just the …
31st August 2021
Questions about the strength of China’s post-lockdown rebound have become louder since the People’s Bank cut the required reserve ratio three weeks ago. But the trigger for this week’s sharp equity market sell-off was instead growing disquiet about the …
30th July 2021
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 …
30th June 2021
State media announced today that China’s family planning policy will be relaxed to allow all families to have three children, up from the current limit of two. This comes shortly after China’s once-a-decade census showed that its population is aging even …
31st May 2021
The Q1 industrial profits data published this week were very strong. Net profits continued rise rapidly and are now 50% higher than they were two years ago. Only a third of this is due to higher sales. Instead, the bulk of the increase has come from …
30th April 2021
China’s vaccination campaign has accelerated sharply over the past week. The daily pace of vaccination is now only just short of the five million needed to hit the target of inoculating 40% of the population by the end of June. (See Chart 1.) The …
1st April 2021
Incoming data continue to point to strength in domestic activity, spending and revenues. Yet strains in China’s corporate bond market continue to grow, with the value of defaults hitting all-time highs. (See Chart 1.) This underlines the degree to which …
25th February 2021
Short-term funding costs for banks have risen sharply during the past couple of weeks. The 7-day depository repo rate (DR007), which has been flagged by the PBOC as a key benchmark and focus of monetary policy, jumped over 100 basis points to a two-year …
29th January 2021
COVID-19 has wreaked havoc on the world economy, which is set to contract the most since WWII this year. China has not been immune – it is on track for its slowest growth since the Mao era – but set against the gloomy global backdrop, its economic …
23rd December 2020
There is no clearer sign that China’s economy is back to normal than the return to centre stage of concerns about property developers, the bad debts of SOEs and financial risks. Regulators’ tolerance for defaults ebbs and flows with their confidence in …
25th November 2020
China’s leaders concluded their discussions on the 14 th Five-Year Plan today. The initial post-meeting communique offered few new details but more may be revealed at a press conference tomorrow. The priorities the Plan sets will shape the country’s …
29th October 2020
The speed at which officials in China have pivoted from crisis response to another round of restrictions on property developers has caught many by surprise. Developers might have hoped that they would be enlisted again to help with stimulus, as happened …
28th September 2020
The consumption share of GDP had edged up in recent years, but that progress has been reversed by the COVID-19 stimulus response, which has focused on boosting investment. (See Chart 1.) The consumption share should start to rebound again soon as the …
27th August 2020
Private investment is down 7.3% y/y so far this year, held back by the uncertain economic outlook. State firms have stepped in to fill the gap. Despite a sharp downturn at the time of China’s lockdown in Q1, their capital spending rose 2.1% y/y during the …
31st July 2020
China’s exports have held up remarkably well in the face of the sharp slump in global activity. They contracted just 3.3% y/y in US dollar terms in May. The detailed trade data published today show that a large part of that resilience was the result of …
24th June 2020
The government’s annual work report published on Friday made clear that policymakers will engineer an acceleration in credit growth this year. The report didn’t offer an explicit target for aggregate financing (AFRE), the official measure of broad credit, …
27th May 2020
Output from China’s industrial sector rebounded in March, as the government encouraged firms to re-open. But revenues remained much weaker, signalling that demand remained depressed. Inventories surged as a result. (See Chart 1.) Subdued demand is likely …
27th April 2020
Activity across both industry and services is recovering as measures to contain the coronavirus have been eased. But the recovery is likely to run into the constraint of weak demand before long. The labour market is the biggest domestic concern. The …
27th March 2020
