China Economics Update Likely damage to China from tariffs only 0.1% of GDP The tariffs announced today will cause difficulties for some firms exporting from China but will have a barely perceptible impact on China’s wider economy. The key uncertainty now is whether President... 22nd March 2018 · 1 min read
China Economics Update The PBOC continues to pretend to follow the Fed For the second time since December, the People’s Bank has responded to a Fed rate hike by raising the rates it charges when providing funds in China’s interbank market. But contrary to perceptions, it... 22nd March 2018 · 1 min read
China Economics Update Capital Flows Monitor (Feb.) Capital outflows edged up slightly in February in seasonally-adjusted terms, though they remain low. The PBOC again refrained from directly intervening in FX markets last month. But with the economy... 21st March 2018 · 1 min read
China Economics Update New PBOC chief a safe choice but his hands are tied After 15 years at the helm of the People’s Bank, Zhou Xiaochuan is passing the title of governor to his protégé Yi Gang, a technocrat with two decades of experience at the central bank. Yi has been a... 19th March 2018 · 1 min read
China Economics Update Government overhauled to strengthen Party control A sweeping overhaul of the structure of China’s government unveiled at the National People’s Congress today could improve financial regulation, reduce red tape for business, and boost productivity in... 13th March 2018 · 1 min read
China Economics Update Is the Hong Kong dollar peg under threat? The Hong Kong dollar has weakened this week to historic lows, though remaining within the narrow confines of its currency peg. But this is the result of ample domestic liquidity which has kept local... 8th March 2018 · 1 min read
China Economics Update A trade war against China would not be “easy to win” The resignation of Gary Cohn, reportedly one of the strongest proponents of free-trade policies within the Trump administration, has raised fears that US trade policy may now turn sharply towards... 7th March 2018 · 1 min read
China Economics Update New Year effects to have lifted inflation in February Following a fall in January, consumer price inflation will probably have jumped last month to a one-year high. We expect a further rise in food price inflation to keep the headline rate elevated over... 6th March 2018 · 1 min read
China Economics Update Initial thoughts on the National People’s Congress China’s retention of an “about 6.5%” growth target for GDP in 2018, while expected, undermines the argument that growth is being demoted as a central policy concern. Growth is likely to slow we... 5th March 2018 · 1 min read
China Economics Update Pain ahead for property developers China’s property sector has had a good couple of years and this has resulted in higher valuations for listed real estate developers. But the recent strength of land sales points, we think, to... 2nd March 2018 · 1 min read
China Economics Update Equity markets stabilise on state support Chinese stock markets have edged up recently following a slump in early February, likely supported by state buying. Meanwhile, the Hong Kong dollar has weakened against the US dollar and may soon run... 28th February 2018 · 1 min read
China Economics Update Hong Kong to cool in 2018 Hong Kong’s economy ended last year on a fairly strong note, supported by buoyant exports. But we think growth will slow over the quarters ahead. The expansionary budget unveiled today will provide... 28th February 2018 · 1 min read
China Economics Update Capital Flows Monitor (Jan.) Our estimates show that outflow pressures eased at the start of this year after picking up in the fourth quarter. Foreign investors acquired Chinese financial assets at a more rapid pace last month... 27th February 2018 · 1 min read
China Economics Update President for life? The removal of the two-term limit on China’s president is the clearest sign yet that Xi Jinping is reversing China’s reform era shift toward more institutionalised and rule-based politics. The quality... 26th February 2018 · 1 min read
China Economics Update Policymakers pushing back on renminbi Today’s sharp move in the renminbi underlines the extent to which policymakers are keen to prevent the emergence of strong speculative pressures on the currency. 8th February 2018 · 1 min read
China Economics Update Inflation on the rise The usual pattern around Chinese New Year is for inflation to rise sharply either in January or February and fall in the other month. This year, we think inflation will have picked up in both. And... 6th February 2018 · 1 min read