China Economics Update Booming land sales flatter local government finances In aggregate, local government debt ratios have been fairly stable during the past few years and there has been a clear improvement in the composition of the debt. But the picture looks less rosy once... 26th April 2018 · 1 min read
China Economics Update Capital Flows Monitor (Apr.) A rise in US-China trade tensions has dominated headlines in recent weeks. But recent developments are not having any impact on cross-border capital flows. Our estimates suggest that flows in and out... 19th April 2018 · 1 min read
China Economics Update Services slowdown led by finance, transport and retail The detailed breakdown of China’s Q1 GDP data released today suggests that although the IT sector has continued to boom, activity in the rest of the service sector has softened recently, offsetting a... 18th April 2018 · 1 min read
China Economics Update RRR cut to support lending to small firms Today required reserve ratio (RRR) cut doesn’t constitute broad monetary easing. But it does signal that – despite the recent strength of the official data – policymakers are starting to balance... 17th April 2018 · 1 min read
China Economics Update Hong Kong interest rates to rise as liquidity tightens The HKMA’s sales of foreign exchange FX to support the Hong Kong dollar, which hit the weak end of its trading band this week for the first time since 2005, shows the exchange rate regime working as... 13th April 2018 · 1 min read
China Economics Update Has Xi done enough to placate Trump? In an attempt to de-escalate trade tensions, Xi has pledged to speed up efforts to reduce trade and investment barriers, boost competition and bolster intellectual property protections. This could... 10th April 2018 · 1 min read
China Economics Update Rising interest rates, trade tensions loom over HK Economic growth in Hong Kong has cooled in recent quarters, and we think this trend will continue over the coming months. Domestic monetary conditions are likely to tighten sharply this year, while... 9th April 2018 · 1 min read
China Economics Update How will China respond to additional US tariffs? If the USTR follows through on Trump’s request to add an additional $100bn worth of Chinese imports to the proposed US tariff list, the Chinese will be reluctant to capitulate and seem likely to... 6th April 2018 · 1 min read
China Economics Update Rising trade tensions increase upside risks to inflation We think consumer price inflation will have risen further last month to a fresh multi-year high, boosted by a rise in food price inflation. This probably marks the peak for inflation this year, though... 5th April 2018 · 1 min read
China Economics Update China raises the stakes of US trade action China’s rapid and aggressive response to the proposed US tariffs has raised the stakes for both sides. But its move to publish a list of counter-tariffs is primarily intended as a deterrent and we... 4th April 2018 · 1 min read
China Economics Update Dancing to a different tune Chinese financial markets have defied global trends recently. Looser monetary conditions have pulled down the country’s bond yields since the start of the year while yields abroad were rising until... 29th March 2018 · 1 min read
China Economics Update Attack on US soybean farmers would hurt China too China’s low-key response to last week’s tariff announcement by President Trump reflects in part a desire not to exacerbate tensions further. But Chinese officials will also be aware that, while they... 28th March 2018 · 1 min read
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
