China Watch – Action Forex https://www.actionforex.com Live Forex Analysis, Currency Rates, Economic Calendar, Technical Forecast, Fundamental News, Free Trading Signals. Best. USD Dollar, EUR Euro, JPY Yen, GBP Pound, CHF Swiss Franc, CAD Canadian Dollar, AUD Australian Dollar, NZD New Zealand Dollar Tue, 15 Sep 2020 11:28:07 +0000 en-US hourly 1 https://wordpress.org/?v=5.5.1 Upbeat August Chinese Data Suggests PBOC to Leave Rates Unchanged for Longer https://www.actionforex.com/action-insight/china-watch/326478-upbeat-august-data-suggests-pboc-to-leave-rates-unchanged-for-longer/ https://www.actionforex.com/action-insight/china-watch/326478-upbeat-august-data-suggests-pboc-to-leave-rates-unchanged-for-longer/#respond Tue, 15 Sep 2020 07:06:53 +0000 https://www.actionforex.com/?p=326478 The latest set of macroecononmic indicators in China suggests that economic activities surprised to the upside in August. Growth in industrial production accelerated while retail sales gained first the first time since February. Better-than-expected data in August signals that it is less likely for PBOC to cut interest rates. Industrial production expanded +5.6% y/y in […]

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Subdued Core CPI and Contraction in Imports Suggest It Takes Time to Revive China’s Domestic Demand https://www.actionforex.com/action-insight/china-watch/325083-subdued-core-cpi-and-contraction-in-imports-suggest-it-takes-time-to-revive-chinas-domestic-demand/ https://www.actionforex.com/action-insight/china-watch/325083-subdued-core-cpi-and-contraction-in-imports-suggest-it-takes-time-to-revive-chinas-domestic-demand/#respond Wed, 09 Sep 2020 06:37:41 +0000 https://www.actionforex.com/?p=325083 Headline CPI moderated to +2.4% y/y in August, from +2.7% a month ago. High base and softened growth in food inflation was the key reason for the slowdown. Food price rose +11.2% y/y, decelerated from +13.2% in July. This was mainly driven by the sharp moderation of pork inflation which eased to +52.6% from July’s […]

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Sharp Rise in Manufacturing PMI Signals that PBOC will Keep the Powder Dry for the Month https://www.actionforex.com/action-insight/china-watch/323319-sharp-rise-in-manufacturing-pmi-signals-that-pboc-will-keep-the-powder-dry-for-the-month/ https://www.actionforex.com/action-insight/china-watch/323319-sharp-rise-in-manufacturing-pmi-signals-that-pboc-will-keep-the-powder-dry-for-the-month/#respond Wed, 02 Sep 2020 05:13:36 +0000 https://www.actionforex.com/?p=323319 China’s manufacturing PMI (by Caixin) rose to almost a decade high of 53.1 August, from 52.8 a month ago. This indicates that China’s manufacturing activities have been expanding over the past 4 months and the rebound has accelerated. The accompanying report noted that output and new orders showed biggest increases since the beginning of 2011. […]

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PBOC’s Restraint Monetary Policy will Continue to Support CNY vs USD. US-China Tensions as Major Downside Risk https://www.actionforex.com/action-insight/china-watch/320401-pbocs-restraint-monetary-policy-will-continue-to-support-cny-vs-usd-us-china-tensions-as-major-downside-risk/ https://www.actionforex.com/action-insight/china-watch/320401-pbocs-restraint-monetary-policy-will-continue-to-support-cny-vs-usd-us-china-tensions-as-major-downside-risk/#respond Thu, 20 Aug 2020 12:41:04 +0000 https://www.actionforex.com/?p=320401 Renminbi (a.k.a. RMB, CNY) has strengthened against US dollar over the past 3 weeks. While the broad-based USD weakness is the key reason, PBOC’s neutral policy action over the past months has also led to renminbi’s appreciation. We expect the phenomenon would persist, supporting renminbi, in coming months. PBOC announced to left the policy rate, […]

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China’s Retail Sales Shrank Further, Evidencing Weak Domestic Demand https://www.actionforex.com/action-insight/china-watch/318749-chinas-retail-sales-shrank-further-evidencing-weak-domestic-demand/ https://www.actionforex.com/action-insight/china-watch/318749-chinas-retail-sales-shrank-further-evidencing-weak-domestic-demand/#respond Fri, 14 Aug 2020 04:49:16 +0000 https://www.actionforex.com/?p=318749 The latest set of macroeconomic data suggests that the pace of recovery in China remained slow, as a result of flooding and second wave of coronavirus outbreak. Improvement industrial activities decelerated, while retail sales continued to shrink. Weak domestic spending was evident in subdued core CPI released earlier this week. The government should maintain an […]

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China’s Trade Surplus Widened in July, Trade Deal Review Next Week In Focus https://www.actionforex.com/action-insight/china-watch/317095-chinas-trade-surplus-widened-in-july-trade-deal-review-next-week-in-focus/ https://www.actionforex.com/action-insight/china-watch/317095-chinas-trade-surplus-widened-in-july-trade-deal-review-next-week-in-focus/#respond Fri, 07 Aug 2020 08:02:42 +0000 https://www.actionforex.com/?p=317095 China’s trade data surprised to the upside in July. This was mainly driven by strong exports, offsetting decline in imports. Exports gained +7.2% y/y in July, following a 0.5% increase a month. This has beaten consensus of a -0.6% drop. From a month ago, exports rose +5.7$, after climbing +1.8% in June. Imports unexpectedly dropped […]

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China’s Economy Continued to Improve in July, but Pace Varied Across Sectors https://www.actionforex.com/action-insight/china-watch/315221-chinas-economy-continued-to-improve-in-july-but-pace-varied-across-sectors/ https://www.actionforex.com/action-insight/china-watch/315221-chinas-economy-continued-to-improve-in-july-but-pace-varied-across-sectors/#respond Fri, 31 Jul 2020 05:34:49 +0000 https://www.actionforex.com/?p=315221 China’s official PMI report reveals that economic activities continued to expand in July. However, the pace of recovery varied across sectors. Manufacturing and construction activities improved faster than expected, thanks to better overseas demand government’s stimulus measures. However, the services sector was dragged as household demand remained weak. Although PBOC has left the policy rate […]

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PBOC Left Policy Rate Unchanged for Three Months, Affirming Targeted Monetary Easing Stance https://www.actionforex.com/action-insight/china-watch/312350-pboc-left-policy-rate-unchanged-for-three-months-affirming-targeted-monetary-easing-stance/ https://www.actionforex.com/action-insight/china-watch/312350-pboc-left-policy-rate-unchanged-for-three-months-affirming-targeted-monetary-easing-stance/#respond Mon, 20 Jul 2020 13:51:33 +0000 https://www.actionforex.com/?p=312350 PBOC has left the policy rate, the 1-year loan prime rate, at 3.85% in July. The 5-year loan prime rate also stays at 4.65%. The decision has been widely anticipated, as the medium lending facility (MLF) rate, the guidance rate for the LPR, was also kept unchanged at 2.95% earlier this month. The central bank […]

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China Recorded Strong Recovery in 2Q20 but Domestic Demand Remained Weak. Risks Skewed to Downside in Second Half https://www.actionforex.com/action-insight/china-watch/311590-china-recorded-strong-recovery-in-2q20-but-domestic-demand-remained-weak-risks-skewed-to-downside-in-second-half/ https://www.actionforex.com/action-insight/china-watch/311590-china-recorded-strong-recovery-in-2q20-but-domestic-demand-remained-weak-risks-skewed-to-downside-in-second-half/#respond Thu, 16 Jul 2020 09:55:59 +0000 https://www.actionforex.com/?p=311590 GDP expanded +3.2% y/y in 2Q20, beating consensus of +2.4%. From a quarter ago, the expanded jumped+11.5%. Concerning major macroeconomic indicators in June, industrial production (IP) rose +4.8% y/y in June, in line with expectations and accelerating from +4.4% in May. Urban fixed asset investment (FAI) declined -3.1% y/y in the first half of the […]

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China CPI Picked Up Due to Temporary Food Price Increase, Unlikely Derail Easing Monetary Policy Stance https://www.actionforex.com/action-insight/china-watch/309510-cpi-picked-up-due-to-temporary-food-price-increase-wont-derail-easing-monetary-policy-stance/ https://www.actionforex.com/action-insight/china-watch/309510-cpi-picked-up-due-to-temporary-food-price-increase-wont-derail-easing-monetary-policy-stance/#respond Thu, 09 Jul 2020 05:58:14 +0000 https://www.actionforex.com/?p=309510 Headline CPI improved further to +2.5% y/y in June, from +2.4% a month ago. This came in line with market expectations Core CPI (excluding food and energy) eased to +0.9% y/y, from +1.1% in May. While staying in the negative territory, PPI improved to -3% y/y in June, up from -3.7% a month ago. This […]

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PBOC to Ease Less Aggressively as Debt Problems Intensify after Months of Liquidity Injection https://www.actionforex.com/action-insight/china-watch/306505-pboc-to-ease-less-aggressively-as-debt-problems-intensify-after-months-of-liquidity-injection/ https://www.actionforex.com/action-insight/china-watch/306505-pboc-to-ease-less-aggressively-as-debt-problems-intensify-after-months-of-liquidity-injection/#respond Mon, 29 Jun 2020 04:10:19 +0000 https://www.actionforex.com/?p=306505 The phenomenon of rising interest rates since early May appears contradictory to Chinese government’s commitment to maintain “liquidity at a reasonably ample level”. PBOC’s leaving of the loan prime rate (LPR), China’s policy rate, unchanged in May and June has fueled speculation about a shift in monetary policy stance. While we believe the bias remains […]

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China’s Inflation Declined to Lowest in Over a Year; Trade Data Showed Weakness in Domestic and Global Demand https://www.actionforex.com/action-insight/china-watch/302136-chinas-inflation-declined-to-lowest-in-over-a-year-trade-data-showed-weakness-in-domestic-and-global-demand/ https://www.actionforex.com/action-insight/china-watch/302136-chinas-inflation-declined-to-lowest-in-over-a-year-trade-data-showed-weakness-in-domestic-and-global-demand/#respond Wed, 10 Jun 2020 09:13:55 +0000 https://www.actionforex.com/?p=302136 Headline CPI slowed further to +2.4% y/y in May, from +3.3% a month ago. The market had anticipated a milder drop to +2.7%. The reading is the lowest since April 2019 and the first time below +3% since August 2019. Food inflation continued to ease significantly. Specifically, growth in pork price decelerated to +81.7% y/y, […]

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PBOC Pauses in Rate Cutting. Outlook Remains Expansionary amidst Global Demand Uncertainty and Renewed Trade Tensions https://www.actionforex.com/action-insight/china-watch/296590-pboc-pauses-in-rate-cutting-outlook-remains-expansionary-amidst-global-demand-uncertainty-and-renewed-trade-tensions/ https://www.actionforex.com/action-insight/china-watch/296590-pboc-pauses-in-rate-cutting-outlook-remains-expansionary-amidst-global-demand-uncertainty-and-renewed-trade-tensions/#respond Wed, 20 May 2020 07:56:39 +0000 https://www.actionforex.com/?p=296590 PBOC this morning announced to leave the loan prime rate (LPR) unchanged at 3.85%. While this had been widely anticipated, it should not be interpreted as a signal of unwinding monetary stimulus. We believe the pause allows the central bank some time to assess the impact of previous easing measures on the economy. Despite upside […]

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More Stimuli Needed to Support China’s Gradual Economic Recovery https://www.actionforex.com/action-insight/china-watch/295312-more-stimuli-needed-to-support-chinas-gradual-economic-recovery/ https://www.actionforex.com/action-insight/china-watch/295312-more-stimuli-needed-to-support-chinas-gradual-economic-recovery/#respond Fri, 15 May 2020 06:17:29 +0000 https://www.actionforex.com/?p=295312 Industrial production (IP) expanded +3.9% y/y in April, beating consensus of +1.5% growth and a -1.1% contraction in the prior month. The strong recovery was mainly driven by the low base effect. Production of automobile, and machinery and equipment contributed the most to the April recovery. These sectors were hurt severely in the first quarter […]

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China’s Inflation Slowed Further in April, Giving Room for Further Easing https://www.actionforex.com/action-insight/china-watch/294193-chinas-inflation-slowed-further-in-april-giving-room-for-further-easing/ https://www.actionforex.com/action-insight/china-watch/294193-chinas-inflation-slowed-further-in-april-giving-room-for-further-easing/#respond Tue, 12 May 2020 05:06:24 +0000 https://www.actionforex.com/?p=294193 Headline CPI eased to +3.3% y/y in April, from +4.3% a month ago. This also marked a two-percentage-point fall from January’s peak. While the major growth driver remained food price, it has been decelerating as the corovavirus outbreak has hurt demand. Food price gained +14.8% y/y last month, easing from +18% in March. Meanwhile, pork […]

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What to Expect from CCP’s Two Sessions? https://www.actionforex.com/action-insight/china-watch/293559-what-to-expect-from-ccps-two-sessions/ https://www.actionforex.com/action-insight/china-watch/293559-what-to-expect-from-ccps-two-sessions/#respond Fri, 08 May 2020 11:43:32 +0000 https://www.actionforex.com/?p=293559 After two months’ delay, the long-awaited “two sessions” will be held in two weeks’ time. The National People’s Congress (NPC) is scheduled on May 22 while the Chinese People’s Political Consultative Committee (CPPCC) is scheduled on May 21. The meetings this year have symbolic meaning from the perspective of the Chinese Communist Party (CCP). In […]

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PBOC Cut Policy Rate to 3.85%, More Easing on the Way https://www.actionforex.com/action-insight/china-watch/288464-pboc-cut-policy-rate-to-3-85-more-easing-on-the-way/ https://www.actionforex.com/action-insight/china-watch/288464-pboc-cut-policy-rate-to-3-85-more-easing-on-the-way/#respond Mon, 20 Apr 2020 09:07:25 +0000 https://www.actionforex.com/?p=288464 PBOC cut the 1-year loan prime rate (LPR), by -20 bps, to 3.85% today. The move has been widely anticipated as the central bank lowered the 1-year MLF rate by the same size last week. LPR is the best lending rate offered by commercial banks, while the MLF rate is the interest rates offer by […]

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China’s GDP Contracted the Most in Decades as Driven its Self-Produced Coronavirus https://www.actionforex.com/action-insight/china-watch/287944-chinas-gdp-contracted-the-most-in-decades-as-driven-its-self-produced-coronavirus/ https://www.actionforex.com/action-insight/china-watch/287944-chinas-gdp-contracted-the-most-in-decades-as-driven-its-self-produced-coronavirus/#respond Fri, 17 Apr 2020 07:10:52 +0000 https://www.actionforex.com/?p=287944 The coronavirus outbreak, started in China, has evolved into a global pandemic, causing great damage to the world economy. The latest data show that it led China to the worst economic downturn on record. Major macroeconomic indicators in March show less significant contraction than a month, a result of relaxed containment measures and the government […]

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Moderation in China’s CPI Allows Government to Accelerate Stimulus https://www.actionforex.com/action-insight/china-watch/286665-moderation-in-chinas-cpi-allows-government-to-accelerate-stimulus/ https://www.actionforex.com/action-insight/china-watch/286665-moderation-in-chinas-cpi-allows-government-to-accelerate-stimulus/#respond Fri, 10 Apr 2020 05:15:49 +0000 https://www.actionforex.com/?p=286665 Inflation in China eased in March. Headline CPI slowed to +4.3% y/y in March, from a 8-year high of 5.2% in the prior month. The market had anticipated moderation to +4.8%. From a month ago, inflation contracted -4.6%, compared with a +9% gain in February. Both food and non-food prices as demand shrank amidst the […]

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Chinese Government Expected to Accelerate Stimulus Despite Sharp Rebound in PMIs. https://www.actionforex.com/action-insight/china-watch/283845-chinese-government-expected-to-accelerate-stimulus-despite-sharp-rebound-in-pmis/ https://www.actionforex.com/action-insight/china-watch/283845-chinese-government-expected-to-accelerate-stimulus-despite-sharp-rebound-in-pmis/#respond Tue, 31 Mar 2020 05:31:51 +0000 https://www.actionforex.com/?p=283845 China’s official PMIs sharply rebounded in March. Manufacturing PMI jumped to 52, from a record low of 35.7 in February. The non-manufacturing index rose to 52.3, from a record low of 29.6 in February. We suggest to interpret the data with caution as the qualitative nature of the survey might have masked the actual situation […]

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