CHINA ECONOMY
China: Fresh loan disbursals jump, but below PBOC expectations
Chinese banks extended 900 billion yuan ($126.86 billion) in new yuan loans in August, up 246% from July but short of analyst expectations, data released by the People's Bank of China (PBOC) showed on Friday. Analysts polled by Reuters had predicted new yuan loans would reach 1.02 trillion yuan last month, versus 260 billion yuan the previous month, but lower than the 1.36 trillion yuan a year earlier.
China’s recovery likely dealt another blow from extreme weather
The widespread weakness would be a signal of how little traction the $17 trillion economy has generated in recovering from its worst stretch in five quarters.
China detains investment bankers, takes passports in corruption sweep
China's investment banking sector faces intense scrutiny as authorities detain top bankers amid President Xi Jinping's common prosperity campaign. Major firms like Haitong Securities are tightening travel restrictions and passport controls for employees. Regulatory probes are impacting the $1.7 trillion brokerage industry, raising concerns about its future while consolidations and pay cuts continue.
US businesses' optimism in China falls to record low, survey shows
U.S. businesses are losing confidence in China due to political tensions, slowing economic growth, and fierce domestic competition. A survey by the American Chamber of Commerce in Shanghai shows only 47% of U.S. firms are optimistic about their five-year outlook in China, the lowest since 1999. Geopolitical concerns and declining profitability are major factors affecting investment and operating plans.
India should build manufacturing economy greener than China's, says Tata Steel CEO Narendran
Tata Steel CEO T V Narendran emphasised the need for India to build a greener manufacturing economy than China. Speaking at the AIMA Convention, he warned that India risks losing market share if it doesn't transition quickly to green manufacturing, especially with mechanisms like the EU's carbon border adjustment tax on imports.
Lower oil prices good for US economy, other countries facing inflation: Farah Mourad
Farah Mourad from Equiti Group discusses the impact of falling crude oil prices on global economies. Lower oil prices benefit central banks and countries facing high inflation but pose challenges for oil-dependent nations. The article also explores the potential effects on emerging markets like India and the overall global economic growth.
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China exports at 18-month high, but slowing imports a concern
China's economy has failed to fire over the past year amid a prolonged property sector downturn, and a survey last week showed exports in the doldrums and factory gate prices at their worst in 14 months, pointing to producers slashing prices to find buyers.
China retail prices inch up, deflation fears grow
The consumer price index excluding volatile food and energy costs rose just 0.3% in August from a year earlier, the least since March 2021, the National Bureau of Statistics said. The broader CPI rose 0.6%, missing expectations even as it was buoyed by higher food costs due to bad weather last month.
As prices hit record, Beijing keeps its gold buying on hold
China's central bank did not add any gold to its reserves for the fourth consecutive month in August, as prices for the precious metal hit a record high. The People’s Bank of China had previously increased its stockpiles for 18 months, supporting bullion prices. Despite this halt, analysts believe central bank buying will continue to drive gold demand this year.
China bulls getting tired of waiting, stock recovery remains elusive
Weakness in Chinese equities is eroding confidence among Wall Street supporters, with hopes for a turnaround fading. Major financial institutions like UBS, Nomura, and JPMorgan have downgraded China's equities due to various concerns. This shift is leading to increased interest in markets like India and Southeast Asia, as China struggles to meet its growth targets.
European luxury companies' $240 billion rout is just the beginning
Once seen as Europe's answer to the US "Magnificent Seven" tech megacaps, shares in companies producing high-end clothing, handbags and jewellery are languishing, sapped by a spending slump. Even more ominous are signs that China's rich, who once flocked to upscale boutiques in Paris, Milan and Hong Kong, may not return, their appetite for pricey items extinguished by the economy's downward spiral.
China stops short of Africa debt relief but pledges more cash in investments and credit lines
China has pledged $50.7 billion over three years in credit lines and investments to Africa but did not provide the debt relief many African countries sought. The funds will support infrastructure and clean energy projects, aiming to improve trade links and tackle power deficits. However, concerns about debt transparency remain.
China manufacturing contracts for fourth straight month
Chinese manufacturing contracted for a fourth consecutive month in August, official data showed Saturday, a worse-than-expected result reflecting the world's second-largest economy's struggle to recover. The non-manufacturing PMI, which includes services, was in positive territory in August at 50.3 points compared with 50.2 a month earlier.
China's lending to Africa rises for first time in seven years, study shows
Chinese lenders approved $4.61 billion in loans to Africa in 2023, according to Boston University. This marks the first increase since 2016. The study suggests Beijing is balancing lending risks. Key recipients included Nigeria and Egypt for significant infrastructure and renewable energy projects, reflecting a strategic shift in China's approach.
As it reins in wasteful investment, China frets over growth
China's local governments are lagging in their debt issuance plans due to increased scrutiny over potentially wasteful infrastructure investments. With local governments having used just 45.5% of their special debt quota so far this year, discussions are underway to redirect funds to other areas to stimulate economic growth closer to the target.
PwC China faces 6-mth business ban, large fine over Evergrande audit, sources say
Chinese regulators are likely to impose a six-month business suspension for part of PricewaterhouseCoopers' auditing unit in mainland China due to its work with troubled property developer Evergrande. The penalties could include a fine of at least 400 million yuan, affecting PwC's securities-related business and clientele in the country.
Businesses are already girding for next phase of the US-China trade war
American manufacturers, retailers, and shipping agents are delaying investments due to tariff uncertainties on imports, particularly from China. If Trump wins the election, disruption risks increase, while a Harris victory could mean continued trade hostilities, potentially raising costs for components used by US businesses.
Charting global economy: Pessimism about Chinese economy grows, Euro-zone sends distress signals
The euro economy has sent distress signals recently, with consumers unwilling to spend despite outsized wage increases, private-sector activity grinding to a halt, and confidence in its largest member — Germany — tanking.
China's central bank to plan additional policies to support growth
The People's Bank of China (PBOC) will strengthen efforts to effectively implement monetary and financial policies that have been introduced this year and further steps will be made in accordance with the requirements of the State Council, Pan said in an interview with state broadcaster China Central Television on Thursday. He didn't elaborate on potential policies.
China's underwhelming data dampens hope of economic recovery
China's industrial production growth slowed to 5.1 percent in July, down from 5.3 percent in June, and the unemployment rate increased to 5.2 percent. This slowdown comes despite government measures aimed at boosting the economy. Retail sales showed a modest increase, but the real estate sector continues to face challenges, affecting overall economic recovery.
China built tech prowess using chemistry classes and research labs
China's electric car dominance began with early battery research in Texas. Chinese companies have since optimized battery performance and mass production. Increased STEM education and tripled research spending bolster China's technological advancements, challenging U.S. leadership in multiple sectors, including pharmaceuticals and solar panels.
China's economic recovery dragged down by property slump and weak consumption in July
China's economic recovery faced hurdles in July, with a lingering property crisis and subdued consumption weighing it down. Unemployment increased to 5.2%, industrial production growth slowed, and retail sales slightly exceeded expectations. Government initiatives to boost consumer spending may help consolidate the recovery. Challenges persist, including reduced real estate investment and dampened exports due to global frictions.
No respite for Chinese officials as economy shows new signs of weakness
China's economic performance in July raised concerns for 2024, as new bank loans hit a 15-year low and key indicators showed weakening export growth and factory activity. With domestic demand sluggish and a fragile recovery, economists predict the 5% growth target may be missed, highlighting the need for stronger stimulus measures.
Can this tiny economy show Europe how to compete again?
Sweden, amid economic challenges like inflation, managed to excel in the tech sector with companies such as Spotify and Klarna. Initiatives in the 1990s, providing early internet access, and strong social programs contributed to this success. A well-funded social safety net encouraged innovation and risk-taking, making Sweden a European tech leader.
China steel sector’s malaise deepens with no relief in sight
China's steel market is facing challenges due to a prolonged property slump and a lack of relief from the government. Steel demand from construction is expected to shrink by 10% this year, reducing the sector's share of total consumption to around a quarter. Other areas are still expanding, but they are too small to offset the hit from property.
China's factory activity contracts for first time in 9 months, Caixin PMI shows
China's manufacturing activity declined in July for the first time in nine months, according to a Caixin/S&P Global survey. The PMI fell to 49.8, below expectations. The decline in new orders led to the slowdown, attributed to weak demand and client budget cuts, despite recent efforts to stimulate consumption.
China July non-manufacturing activity expands at slower pace
The NBS composite PMI, which includes manufacturing and services, came in at 50.2 in June.
China struck by increasing changes in external environment, insufficient domestic demand
China will enhance macroeconomic policy, counter-cyclical adjustments, and stimulate domestic consumption, according to a Politburo meeting. The meeting highlighted increasing adverse effects from external changes, insufficient domestic demand, and challenges in transitioning to new growth drivers.
China surprises with cuts to key rates to support weak economy
China unexpectedly reduced a key short-term policy rate and benchmark lending rates on Monday to stimulate growth in the world's second-largest economy. This move follows last week's underwhelming second-quarter economic data and a significant meeting of China’s top leaders.
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