China Economics Update Thaw in US-China relations unlikely to last Today’s economic discussions between China and the US are taking place in an atmosphere of unusual warmth. There are two obvious reasons – the fall in China’s trade surplus and the renminbi’s recent... 9th May 2011 · 1 min read
China Economics Update A policy shift on the renminbi China appears to be on the verge of allowing faster currency appreciation in response to inflation . This may not last long if inflation drops back in the second half of the year, as we expect. For... 19th April 2011 · 1 min read
China Economics Update Activity slows, inflation concerns remain China’s Q1 GDP data confirm that the economy has slowed, though the seasonally-adjusted figures were less enlightening than we had hoped. The continued strength of food price inflation is a concern... 15th April 2011 · 1 min read
China Economics Update What should we make of the new financing measure? The People’s Bank today launched a new measure of financing conditions. In this Update we outline what the new measure is and how useful we expect it to be. 14th April 2011 · 1 min read
China Economics Update People's Bank still intervening heavily China may have recorded a trade deficit last quarter but the pace of its intervention to hold down the renminbi barely slowed. Meanwhile, a rebound in lending last month is consistent with our view... 14th April 2011 · 1 min read
China Economics Update Inflation Monitor (Mar.) Food prices probably drove headline inflation back above 5% in March, but non-food inflation still seems subdued, particularly when the impact of January’s re-weighting of the CPI basket is taken into... 13th April 2011 · 1 min read
China Economics Update What should we make of today's rate hike? The timing of today’s rate hike was a minor surprise but the bigger picture is that interest rates have played a small part in China’s tightening cycle to date. We think that monetary tightening over... 5th April 2011 · 1 min read
China Economics Update Commodity prices drive abrupt rebalancing of China's trade High commodity prices have achieved what the last Five-Year Plan and a string of summits with key trading partners could not: a rebalancing of Chinese trade. In this China Watch we consider the... 31st March 2011 · 1 min read
China Economics Update Overheating concerns set to decline Evidence is mounting that China’s overheating threat is receding. The People’s Bank will continue to raise reserve requirements, as it did today, to ensure that bank lending remains under control... 18th March 2011 · 1 min read
China Economics Update The view from the ground - Q1 2011 China’s businesses are signalling that demand is slowing. Households are slightly less concerned about inflation than they were three months ago. By a wide margin, they still prefer to save rather... 16th March 2011 · 1 min read
China Economics Update Retail sales slowdown highlights challenge of rebalancing With the usual volatility around Chinese New Year and revisions to the way key data are collected clouding the view, about the only clear picture that emerges from China’s latest data is that retail... 11th March 2011 · 1 min read
China Economics Update Inflation trouble underlines China’s growth failures Premier Wen Jiabao put price stability at the centre of the government’s concerns in his speech at the weekend. So here is a question for delegates to the National People’s Congress to ponder during... 9th March 2011 · 1 min read
China Economics Update Inflation Monitor (Feb.) Non-food inflation has continued to rise but we remain sanguine about the outlook, not least because much of the latest increase seems to be due to the introduction of new index weights. High oil... 8th March 2011 · 1 min read
China Economics Update Is China committed to rebalancing? Much of the talk at the National People’s Congress is of the need to boost domestic demand. But with the finance ministry projecting an even smaller budget deficit for 2011 than 2010, the government’s... 7th March 2011 · 1 min read
China Economics Update What should we make of the lower growth target? The inclusion of a lower growth target in the new Five-Year Plan is a simple acknowledgement that growth will slow as China’s pool of surplus rural workers dries up. The call for better quality growth... 2nd March 2011 · 1 min read
China Economics Update Hong Kong property bubble growing Hong Kong’s economy is growing at a healthy pace but residential property looks increasingly overvalued and today’s budget underlines that the government has few effective means to help. 23rd February 2011 · 1 min read