China Economics Weekly Shadow banks are getting squeezed Zhongzhi won’t be the last shadow bank to run into trouble. Others are also suffering from mounting losses on their assets and a funding squeeze as cautious investors shift money into deposits and... 18th August 2023 · 5 mins read
China Economics Weekly Export pullback understated, foreign travel to pick up The export data published by China’s customs bureau appear to have become less reliable recently and subject to unusually large revisions. Alternative indicators suggest that the true level of exports... 11th August 2023 · 6 mins read
China Economics Weekly Near-term fiscal boost, follow-up measures needed Local governments have been told to issue and spend their remaining special bond quotas by end-October, which will boost fiscal outlays in the near-term. But more needs to be done to prevent a... 4th August 2023 · 7 mins read
China Economics Weekly Politburo keeps stimulus hopes alive The highlight of the week was Monday’s Politburo meeting, which struck a dovish tone and promised greater policy support. A lot will depend on the follow-through, and in this note we flag some areas... 28th July 2023 · 7 mins read
China Economics Weekly Reviving private investment and hiring won’t be easy After making life more difficult for many private firms in recent years, China’s leadership is shifting course and has made high-level pledges to improve the business environment. But although parts... 21st July 2023 · 5 mins read
China Economics Weekly Targeted rather than broad policy support Policymakers have taken further steps to support the economy this week. But these moves have been targeted at struggling sectors rather than the wider economy through broad policy stimulus. We think... 14th July 2023 · 8 mins read
China Economics Weekly Export curbs will become blunt with use The PBOC has succeeded for the time being in stemming the slide in the renminbi. It wouldn’t take much for pressure to return, but we think the balance of probabilities points to a stronger currency... 7th July 2023 · 8 mins read
China Economics Weekly Households remain cautious, loan demand softens The PBOC’s survey of depositors suggests that the household savings rate declined further in Q2 but may still be well above pre-pandemic levels amid a renewed deterioration in consumer sentiment. A... 30th June 2023 · 4 mins read
China Economics Weekly Waiting for stimulus, heatwave highlights climate risks Aside from token 10 basis point rate cuts and an extension of EV tax breaks, there hasn’t been much in the way of policy stimulus yet. We still think a more meaningful, infrastructure-focused fiscal... 23rd June 2023 · 6 mins read
China Economics Weekly Fiscal stimulus needed, baby bust continues The initial policy response to the economy’s recent loss of momentum has been to cut interest rates. But on its own, this is unlikely to trigger a jump in household or corporate borrowing and spending... 16th June 2023 · 5 mins read
China Economics Weekly Shift in risk appetite needed to revive property Rumoured plans to support housing demand by reducing the upfront cost of home purchases probably won’t be a game changer. New homes are already more affordable than they’ve ever been and yet... 9th June 2023 · 7 mins read
China Economics Weekly Don’t give up on the Chinese consumer just yet The pessimism around China’s consumer recovery is overdone in our view. The labour market is tightening, which should soon start to benefit young jobseekers and support income growth. And consumers... 1st June 2023 · 8 mins read
China Economics Weekly Unfinished homes, chipmaking woes Detailed housing sales data show that worries about developers’ ability to complete projects continue to hamper demand. And despite some progress, the number of stalled projects remains very large... 26th May 2023 · 6 mins read
China Economics Weekly Monetary easing back on the cards In its latest policy report, the PBOC argued that the recovery has exceeded expectations and that the recent drop in inflation isn’t a major concern. Nonetheless, it still struck a dovish tone... 19th May 2023 · 5 mins read
China Economics Weekly Making sense of the reopening recovery After a string of underwhelming but inconclusive data releases, we should have a better sense of the strength of China’s post-zero-COVID rebound next week with the release of the April activity and... 12th May 2023 · 6 mins read
China Economics Weekly Consumer spending is back on track The Labour Day holiday was a key test of China’s consumer recovery. It passed with flying colours – domestic travel and tourism returned to normal, while retail sales look to have returned to the pre... 5th May 2023 · 8 mins read
