Update Alerts

China’s PMI shows resilience in January

China’s official Purchasing Managers’ Index (PMI) rose to 50.5% in January, from 50.3% in December, confirming our research showing that the domestic manufacturing sector is more resilient than expected. The resilient performance provides evidence that a looser liquidity policy adopted since last November, complemented by a cut in bank reserve requirement ratios (RRR), is helping to boost demand and keep the “soft landing” scenario on track. This being the case, we think that Beijing no longer needs to cut the RRR each month in 1H 2012, but may decide to cut the ratio around three times over the first half.

  • 01 February 2012

China's GDP figures suggest further liquidity easing

China's 4Q11 GDP growth rate of 8.9%, down from 9.1% in 3Q11, shows a slowing economy that is more resilient than many have expected. However, we think that clear signs of a slowdown in fixed asset investment is likely to spur progressive liquidity easing in 1H12.

  • 17 January 2012

Fall in China forex reserves adds pressure for liquidity easing

Data from the People's Bank of China (PBOC) published today shows a $20.6bn, or 0.6 %, fall in China's official foreign exchange reserves which slipped to $3.18tn in 4Q11. A fall in reserves in both November and December represents the first consecutive monthly fall since the first quarter of 2009. We think the figures show continued outflows of "hot money" and raise pressures for a further easing in domestic liquidity.

  • 13 January 2012

Growth in discretionary spending among cardholders moderates in December

China's Bankcard Consumer Confidence Index, a measure of cardholder spending on non-essential items, picked up 0.8 percentage points YoY to 86.72 in December, China UnionPay, which compiles the index, said. However, MoM growth moderated to a mere 0.03 percentage points from November, the slowest magnitude in MoM growth since July last year when discretionary spending began recovery.

  • 13 January 2012

China’s inflation suggests more liquidity easing

Inflation figures released today extend Beijing's license to ease liquidity policy further in coming weeks (CC Jan 12 Macro View) and further relieves manufacturers from the big margin squeeze that characterised 2011 (CC Jan 12 Consumer China).

  • 12 January 2012

China trade figures underline need for consumer stimulus

Trade figures announced today underline the need in China for policies to stimulate consumer demand and spur exports. Growth in imports for domestic consumption halved to 13.5% in December YoY from November while imports for processing trade – mostly components destined for re-export – grew by 6.2% YoY, down from November’s 11% YoY rate. By contrast, import volumes of resources, including metal ores and oil, held up strongly during December.

  • 10 January 2012

PBoC surveys show exporter sentiment, inflationary pressure continue to weaken

Two sets of survey data released by China's central bank on Thursday show business sentiment among China's entrepreneurs continues to weaken. Of 5,000 companies surveyed by the People's Bank of China (PBoC), 24.8% believe China's economic status to be 'relatively cool' while the percentage of those believing that conditions are still normal slipped to 67.1% from 74.3% in the first quarter. A separate index of company owners' views of economic conditions for the fourth quarter declined 6pp QoQ to 41.7.

  • 22 December 2011

China property sales mixed in week, mortgage rates ease

Property transactions in a selection of 18 first and second tier cities tracked by China Confidential rose 6% in the week ended December 18 compared to a week earlier. Transactions in the third and fourth tier cities fell 8% week on week.

  • 20 December 2011

Kim Jong Il death rattles markets

Markets closed down in Asia in response to the death of the North Korean leader Kim Jong Il and concerns over the transition of power in China's northerly neighbor. The benchmark Shanghai Composite Index dropped 0.3%, or 6.61 points, to close at 2,218.24 while the Shenzhen Component Index slid 0.31%, or 27.86 points, to finish at 9,054.08. The dips mirrored similar slides in the Korea Composite Stock Price Index (KOSPI), which slid 3.43%, and the Nikkei Stock Average, down 1.26%.

  • 19 December 2011

Property transaction volumes continue to slide

Property transactions in first and second tier cities fell further in the week ending December 11 though restrictions in the market are likely to remain.

  • 15 December 2011

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China Confidential Funds, a new research service launched by FT China Confidential, is dedicated to illuminating the mainland fund industry. Our team of fund industry experts in Shanghai search out the interesting trends in fund performance, strategy, interactions with overseas funds, regulatory changes, distribution and management. We also use a proprietary system to track the emerging flows of Chinese money. Click here to find out more.

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