China Economics Update Should we fear deflation in China? The slide in inflation in China, as elsewhere, has been driven primarily by commodity price falls due to increases in global supply. It is unambiguously positive for China’s economy. Evidence that... 16th February 2015 · 1 min read
China Economics Update New Year effect pulls inflation to five-year low We expect consumer price inflation to have fallen to the lowest in more than five years in January, dragged down by further declines in commodity costs and the ususal volatility around Chinese New... 9th February 2015 · 1 min read
China Economics Update PBOC signals continued policy support Today’s required reserve ratio cut is primarily a signal that the People’s Bank is maintaining the more accommodative stance adopted in November rather than a response to capital outflows or “currency... 4th February 2015 · 1 min read
China Economics Update Shrinking workforce not a major threat to growth The release of figures showing that China’s working age population continued to fall last year has revived concerns about demographic headwinds to China’s growth. In this China Watch we discuss why... 30th January 2015 · 1 min read
China Economics Update Equities hit choppy waters Chinese equities turned more volatile over the past month, and there are signs that some steam may be coming out of the market. Meanwhile, market interest rates have been relatively stable, with a... 30th January 2015 · 1 min read
China Economics Update How durable is the Hong Kong peg? The Swiss National Bank’s (SNB) decision last week to abandon its exchange rate ceiling has put Hong Kong’s peg to the US dollar under fresh scrutiny. While the peg creates a number of problems, it... 20th January 2015 · 1 min read
China Economics Update How much does today’s slide in Shanghai matter? There had been signs even before today’s share price slide that China’s equity markets were coming off the boil. The direct impact of any sustained slump in equity prices would be small, both in China... 19th January 2015 · 1 min read
China Economics Update No end in sight to build-up in China's credit risks Recent progress made towards curbing the rise of China's credit-to-GDP ratio is likely to slow going forward as it becomes more difficult to continue to rein in credit without undermining growth. 19th January 2015 · 1 min read
China Economics Update Shining a light on “stealth” stimulus Markets have latched onto two low-key policy developments at the start of 2015 as evidence that policymakers are pursuing both monetary and fiscal stimulus by stealth. We don’t think either amounts to... 8th January 2015 · 1 min read
China Economics Update Inflation steady for now despite oil price plunge Retail fuel prices have fallen rapidly in China, as elsewhere. In December though, China’s vegetable prices rose sharply, with the result that we are unlikely to see the large fall in headline... 7th January 2015 · 1 min read
China Economics Update Renminbi reverses course A month after benchmark interest rates were cut in China, market interest rates have risen, putting the People’s Bank under pressure to do more to reduce financing costs. Meanwhile, the equity markets... 22nd December 2014 · 1 min read
China Economics Update China's GDP set for statistical boost The government is tomorrow likely to announce an upward revision of perhaps 5~10% to its estimate of the size of China’s economy. Nothing will have changed on the ground, but the data revisions will... 15th December 2014 · 1 min read
China Economics Update Wealth management product risks under spotlight Proposed new regulations governing how banks handle wealth management products should help to contain risks in this rapidly growing area, though at the cost of crimping credit growth. 9th December 2014 · 1 min read
China Economics Update Inflation to moderate further Inflation may have dropped to its lowest in nearly five years in November. We are expecting further falls in the months ahead that will add to concerns about the threat of deflation. 5th December 2014 · 1 min read
China Economics Update What is behind the surge in Shanghai equities? While there are some economic reasons for China’s equity markets to have done well recently, they can’t explain the scale of the recent surge. Turnover, leverage and account openings have all soared... 4th December 2014 · 1 min read
China Economics Update What to expect in 2015 China’s leaders will be gathering in Beijing shortly to discuss priorities for 2015. In this month’s China Watch we outline our views on what to expect on growth, monetary policy and reform. 4th December 2014 · 1 min read
