China Economy


China panic jawbones crashing economy

China yesterday promised to fix all the things. While doing nothing to actually deliver it: China’s top financial stability regulators pledged on Wednesday to take measures to maintain stability of its economy and the capital markets and shore up economic growth in the first quarter of 2022. The State Council’s Financial Stability and Development Committee,


Lowy Institute: China’s economic rise is over

A great piece from the Lowy Institute catching down to the MB view of China. — REVISING DOWN THE RISE OF CHINA KEY FINDINGS China will likely experience a substantial long-term growth slowdown owing to demographic decline, the limits of capital-intensive growth, and a gradual deceleration in productivity growth. Even with continued broad policy success,


Roll up for China versus OMICRON

Roll up for China versus OMICRON: Covid cases continue to surge as Omicron strengthens its grip on the Chinese mainland. Hong Kong provides a grim preview of what could unfold in China if the outbreaks are not brought under control. Both territories have relatively low vaccination rates amongst the elderly, and in Hong Kong’s case


Chinese hard landing dead ahead

More on yesterday’s better than feared Chinese growth numbers from Pantheon Economics. My own view is that China is still on track for a hard landing later this year as external demand hiccups just as OMICRON and realty hammer domestic demand.  — China: Industrial production slowed to 7.5% ytd y/y in February, from 9.6% in


Chinese export sector drives growth beats

China’s Jan/Feb data is out today and voila, it is booming versus consensus with retail sales at 6.7%, industrial production at 7.5% and fixed asset investment at 12.2%: Under the bonnet, real estate did much better than private data suggested it was doing. Floor area starts still fell materially year-on-year but the pace of falls


Chinese property falls off cliff, economy to follow

If you’re looking for China to fix the global economy then forgedaboudit. Its crucial property sector is resisting all attempts to arrest its decline.  Increasingly it resembles more a falling anvil. Developer funding spreads have fallen off the proverbial cliff in the past few days: The carnage continues to eat individual names: Property developer Logan Group


China stimulus pushing on a string

Pantheon Economics with the note. I 100% agree. — China’s 2022 Work Report: Road Map or Wish-List? Opening China’s National People’s Congress on March 5, Premier Li Keqiang warned of the “arduous efforts” needed from policymakers, despite the lowest growth target in decades, as the country’s external environment becomes more “volatile, grave and uncertain”. Trade


Professor: Sanctioning China over Taiwan war too costly

Readers will recall Profesor James Curran, the most persistent China apologist of 2020/21: He is anti-American. He is confused by Keatingesque fantasy and “China is inevitable” propaganda. Is happy to sell Aussie freedoms for a few yuan more. Having been wrong for several years now, and having learned nothing from Australia’s comprehensive victory over China


Chinese property “worst ever start to a year”

Is this why China wanted Russia to invade Ukraine? To distract us all from the intensifying shakeout around its property developers? Joking. But, it’s working nonetheless. Spreads this week hit records: And what happens when that transpires? As defaults literally pile up: Goldman’s summary is priceless: Physical property market recovery remains elusive. Despite the introduction


China zero COVID going nowhere

Pantheon Economics with the note. — The latest survey readings for China’s service sector show that Covid, and the policies aimed at suppressing it, continue to weigh heavily on activity. Recent press headlines have suggested that a change to China’s zero-Covid stance is in the offing, which is an exciting prospect if true. Sadly, the


Chinese property market still rooted

It’s been overwhelmed by the war panic, but the fundamental driver of hard commodity demand worldwide remains completely screwed. First, Chinese property sales remain awful and getting worse: China’s real estate market continued to cool last month, as data showed sales were nearly halved from a year ago despite regulators relaxing financing policies in an


China panics about Russia. Taiwan safer by the minute?

The waft of panic coming from Beijing over the developing Ukrainian quagmire is something to behold: What a difference a few weeks make. In early February, Vladimir Putin and Xi Jinping proclaimed after a “warm and friendly” meeting in Beijing that the friendship between Russia and China had “no limits”. But on Tuesday, it was


Chinese property bust still getting worse

This past week saw developer spreads soar once again: Floor area sales are terrible: The great white hope of local government infrastructure has brought forward debt issuance but over the year the quotas will be the same. Meanwhile, collapsed land sales revenue will reduce construction activity over the full year: Goldman has more the forthcoming


China fights losing stimulus battle as property dies

China is the last bastion of attempts to a productivity-driven economy over a financialised one. Even then only very marginally and there is it still quite unclear if it going to succeed as it attempts to wean itself from the property monster at the heart of financialisation everywhere. Toda that attempt is still looking pretty


China is still headed for a hard landing

Chin’s property shakeout continues at full throttle. The developer’s funding crisis is roaring along. Vulture funds that have prospered with shorts and bottom-feeding longs no longer know where to look: Even as the authorities step up liquidity support to stem an economic slowdown, last year’s top-ranked managers in China are turning more cautious with little


Chinese property contagion wipes out new Evergrande

Still no joy for the beleaguered Chinese property market as the crisis rolls on. Developer spreads remain paralysing: Barclays captures the mood: Zhenro Properties stole the show this week as its 10.25% perpetuals fell 70pts, to 23, on concerns that the company may not redeem the bonds in March as previously planned. This follows the


Defaults pile up in Chinese property

The relentless pounding of Chinese developers continues. Dollar spreads are headed toward new wides: And is it any wonder? The defaults continue to pile up: Yango Group Fails to Pay Interest for Two Dollar Bonds (7:02 p.m. HK) Yango Group Co. Ltd missed interest payments of a combined $27.3 million for its two dollar bonds, listed


The great China deflation accelerates

The headwaters of global production are not only not inflationary, but they are rapidly turning deflationary. China’s PPI is now overshooting forecasters to the downside: In January 2022 , the national ex-factory price for industrial producers increased by 9.1% year-on-year and decreased by 0.2% month-on-month ; the purchase price of industrial producers increased by 12.1% year -on-year and decreased by 0.4% month-on-month . The price falls


When will the yuan fall?

It’s part of my base that CNY will weaken in due course. This is going to transpire just as US growth comes off hard with Fed tightening and an external shock hits China. A falling CNY also drags down commodity prices. This will end the global tightening. Pantheon has more: —————- China saw another huge


Chinese property lending booms backwards

The Chinese property adjustment continues today: China High-Yield Dollar Bonds Extend Drop as Logan Leads Decline China AMCs May Not Be White Knights for Developers’ Bondholders Ronshine Hires Advisers Ahead of Maturing Bond: Debtwire  China’s Property Woes Engulf London with Stalled Projects, Sales China Property Crisis, Zhenro’s Risk Threaten Wider Contagion China Court Freezes 50m


Chinese “home buyers’ confidence has evaporated”

Yes, the greatest and least covered bearish show on earth keeps getting worse. The pounding of Chinese developers is as severe as it is relentless. Here’s one day’s headlines: Moody’s Cuts Zhenro, Changes Outlook to Negative (6:02 p.m. HK) Moody’s downgraded Zhenro Properties Group Ltd.’s corporate family rating to B3 from B1, and the company’s senior unsecured


Chinese property adjustment continues unabated

China’s ongoing property developer shakeout contines. Spreads are still disastrous: Property sales are still terrible (though beware the distortions of an earlier than usual Lunar NY): The PBOX Q4 monetary report confirmed property is to remain under the thumb. Goldman: On property, the Q4 report stressed policymakers’ commitment to property market regulation: the PBOC reiterated


China rains credit on everything but houses

What a world. Chinese credit was out overnight and it is raining credit on everything in sight, with the clear exception of houses. TSF was the highest ever at 6.17tr yuan of which banks loaned 3.98tr: But, what appeared to be blowoff credit at the headline level is actually pretty muted under the bonnet. The