China Economics Update Further slowdown likely but no hard landing Targeted policy intervention has helped shore up activity recently but China’s economy will face continued headwinds from a slowing property sector and efforts to rein in credit in the years ahead... 3rd July 2014 · 1 min read
China Economics Update Policymakers taking stock as hard landing fears ease Policymakers in China have good reason to be pleased about the state of the economy at the half-way point of 2014. Their decision to tweak policy rather than opt for broad stimulus appears to have... 30th June 2014 · 1 min read
China Economics Update Upward pressure on renminbi is building The renminbi has been allowed to strengthen by 0.5% against the dollar so far this month. A rebounding trade surplus will, in our view, force the People’s Bank to tolerate further gains in the months... 27th June 2014 · 1 min read
China Economics Update The view from the ground – Q2 2014 Business and household confidence in China took a turn for the worse this quarter, but it is not at an alarmingly low level. Meanwhile, banks are reporting a decline in loan demand, particularly from... 26th June 2014 · 1 min read
China Economics Update FX reserves are no magic bullet in a debt crisis The foreign exchange reserves of the People’s Bank would be of little use in the event of a debt or banking crisis in China. The bulk of the costs of any clean-up would ultimately still be paid by the... 25th June 2014 · 1 min read
China Economics Update What is the PBOC up to? Tracking the stance of the People’s Bank has become more difficult as it has brought a large number of policy tools into play. But the consistent goal appears to be to stabilise credit growth. 16th June 2014 · 1 min read
China Economics Update Partial RRR cut illustrates reluctance to ease policy Details just published on the People’s Bank website about the targeted required reserve ratio cut that was first announced in late May underline how reluctant policymakers remain to pursue across-the... 9th June 2014 · 1 min read
China Economics Update Policymakers still resisting calls for broad stimulus In the past few weeks, policymakers have adopted an approach to supporting the economy that is the opposite of that followed in 2008. Then, banks were encouraged to flood the economy with credit. Now... 9th June 2014 · 1 min read
China Economics Update Inflation Monitor (Jun.14) With both consumer and producer price inflation likely to have risen in May, there are few convincing signs that China is sliding into deflation. This should ease calls for the People’s Bank to roll... 5th June 2014 · 1 min read
China Economics Update Local government dependence on property exaggerated The ongoing slowdown in the property sector is hitting land sales, which some have suggested has worrying implications for local government finances. We think the risks are being exaggerated and that... 5th June 2014 · 1 min read
China Economics Update Why we are still betting on renminbi appreciation The People’s Bank has succeeded over the past few weeks in shifting expectations for the renminbi’s future path while also scaling back its foreign exchange accumulation. At first glance the data... 2nd June 2014 · 1 min read
China Economics Update Renminbi stabilises in May The renminbi appears to have stabilised in May as market participants have pared back expectations for the currency’s appreciation. Meanwhile, weaker demand for interbank funds, along with liquidity... 30th May 2014 · 1 min read
China Economics Update A positive step on local government debt Allowing local governments to issue bonds is a key step towards boosting transparency and encouraging stronger oversight over fiscal spending. But a broader rebalancing of the revenues and spending... 22nd May 2014 · 1 min read
China Economics Update Inflation Monitor (May 14) Headline inflation is likely to have dropped in April but is set to rebound this month, due to swings in food inflation. That said, the broader picture is that price pressures remain low and stable... 6th May 2014 · 1 min read
China Economics Update Would a further slowdown in growth threaten employment? In recent months, Chinese policymakers have stressed repeatedly that employment growth, rather than rapid GDP growth, is their number one priority. This has led to speculation about how fast the... 2nd May 2014 · 1 min read
China Economics Update Further RMB weakening tests the PBOC’s nerves After large-scale intervention succeeded in weakening the renminbi and rattling many investors, there are tentative signs that the People’s Bank is now trying to introduce some stability. 30th April 2014 · 1 min read
