Another spooky parallel between China and Australia today. Cross-posted from Investing in Chinese Stocks.
The latest PMI report (2015年3月中国制造业采购经理指数为50.1%) gave a reading of 50.1, barely positive. The breakdown was as follows:
The bottom right column is business expectations. At 61.3, manufacturers are the most optimistic they’ve been since exactly one year ago. Expectations are also the main shift in the PMI number, with other data points near the lows of the past three months.
Aside from the hope in the manufacturing sector, there is hope in the real estate sector that’s been boosted by recent government policies. Hope is also strong in the stock market. In contrast, economic data is still negative.
Initial impact in the real estate sector is encouraging, at least one research firm covering 30 cities reports sales rose 70% in March from February.
Superimposed effect of the policy for the property market has brought good news. March 2015, E-House Real Estate Institute of monitoring of 30 typical city new commercial housing turnover area of 14.39 million square meters, growth of 71.2% mom, an increase of 8.3% yoy.
The question is whether the uptick holds, or whether this is again a cannibalization of future demand as marginal buyers jump into the market.
Recall last year, Hangzhou ended buying restrictions in July and the result was You Can See Why Developers Are Optimistic: 2000 Panic Buyers. Before August was finished, however: Hangzhou Housing Rebound Fades. iFeng: 政策叠加成效初显 30城成交面积环比增七成.
The propaganda department is doing its best:
All the nation’s propaganda departments and news organizations…
Support the stable development of real estate and social stability…
On the suggestion of leadership, news organizations please focus on the stable real estate market policies, support the Housing and Urban Development and other departments to do a good job of guiding public opinion on the real estate market, to for a stable real estate market and healthy development, and to create a good atmosphere for public opinion.
1. Strengthen the real estate market, positive publicity, efforts to boost confidence
Focus on public opinion, persist in positive agenda setting, objectively cover of the real estate market situation, accurate interpretation of the relevant policies and measures to correctly guide market expectations, boost market confidence.
(1) Accurate interpretation of the relevant State Council departments propaganda interpret real estate market regulation policy measures, propaganda, the State Council attached great importance to residents of the housing problem, make full use of government regulation and market mechanisms are two means to take effective measures to promote the healthy development of the real estate market, ask the poor, the party central, State Department
The paper does not say to distort reality. Media is instructed to objectively report on the situation, but to be positive in the outlook, guide public opinion in a favorable direction. It’s a confidence game now.
