China Economics Weekly Financial sector opening, bad debt disclosures Efforts to open the door to more foreign participation in China’s financial sector took another step forward this week. But without broader free-market reforms, foreign entrants may still struggle to... 3rd May 2019 · 1 min read
China Economics Weekly Equities may fall further as recovery underwhelms The less dovish tone of recent comments from the People’s Bank and from Premier Li is the latest sign that policymakers are keen to avoid the sort of debt-financed surge in growth that followed... 26th April 2019 · 1 min read
China Economics Weekly Seasonality, tax cuts distort the industrial output data Among the better-than-expected data published this week, industrial output growth stood out as especially strong after it jumped by the most since March 2009. But there are reasons to think that... 18th April 2019 · 1 min read
China Economics Weekly Will residency reforms revive the property market? The government’s plans to make it easier for rural migrants in small cities to acquire urban residency permits have raised hopes of a revival in property sales. But the nationwide impact will probably... 12th April 2019 · 1 min read
China Economics Weekly More monetary easing still on the cards Markets no longer expect further monetary easing in China but we aren’t convinced. Headwinds to growth look set to resurface as support from fiscal front-loading wanes, at which stage the stimulus... 5th April 2019 · 1 min read
China Economics Weekly Consumer sentiment softens, inflation risks rise The latest central bank surveys suggest that firms turned more upbeat this quarter as trade tensions eased and banks expanded lending. However, this positive shift in business sentiment has yet to... 29th March 2019 · 1 min read
China Economics Weekly Fiscal front-loading, land demand, BRI obstacles While China’s incoming economic data have mostly been weak recently, two under-reported positives have helped shore up growth: a fiscal splurge by local governments and strong property construction... 22nd March 2019 · 1 min read
China Economics Weekly Three takeaways from the NPC Premier Li spoke to the press at the close of the National People’s Congress (NPC) today. He offered further details on the timing and scale of policy support – smaller than in previous cycles but... 15th March 2019 · 1 min read
China Economics Weekly On contradictions (from the NPC) There is a tension between the policy stimulus announced this week at the National People’s Congress and the government’s goal of keeping the debt ratio stable. Ultimately, we expect officials to err... 8th March 2019 · 1 min read
China Economics Weekly Deleveraging delusions, market exuberance Policymakers are already billing the deleveraging campaign a success. But we doubt that the recent stabilisation of the debt ratio will prove durable. Meanwhile, Chinese equity prices have jumped... 1st March 2019 · 1 min read
China Economics Weekly Trade talk optimism, RMB stability pledge Negotiators are making progress sketching out the specifics of a US-China trade deal, which suggests that Trump is likely to postpone the tariff hikes scheduled for next week. But the big picture is... 22nd February 2019 · 1 min read
China Economics Weekly Wider credit spreads dulling impact of policy easing Rising defaults have widened credit spreads during the past year, preventing borrowing costs for less creditworthy firms from falling in response to looser monetary conditions. Given that subprime... 15th February 2019 · 1 min read
China Economics Weekly Renminbi to weaken again, banks boost capital buffers Progress in the US-China trade talks and the dollar’s fall following the US Fed’s dovish policy statement this week pushed the renminbi to a six-month high. But we think that pressure on the currency... 1st February 2019 · 1 min read
China Economics Weekly Middle-income squeeze weighing on consumption On paper, China’s rebalancing is going swimmingly, with the consumption share of GDP growth jumping last year to its highest level in almost two decades. But this is hard to square with broader data... 25th January 2019 · 1 min read
China Economics Weekly PBOC to guide interest rates lower, 2017 GDP revised The liquidity injection by the PBOC this week was the largest on record. But it was mainly intended to manage the usual cash crunch ahead of Chinese New Year rather than loosen monetary conditions... 18th January 2019 · 1 min read
China Economics Weekly Official targets point to low expectations for 2019 The economic targets for 2019 that have been leaked this week signal official acknowledgement that China’s growth is slowing. Nonetheless, the low target for the fiscal deficit suggests that... 11th January 2019 · 1 min read