Shanghai Loosens Homebuying Rules to Combat Property Slump
Bloomberg: "Shanghai eased homebuying rules, in the latest attempt by authorities to contain the nation’s prolonged property slump." https://t.co/7gAmMs7Onw
Yuan Deposits Rise, Household Growth Slows, Non‑bank Surge Persists
Yicai: "Chinese yuan deposits saw strong year-on-year growth in January, but the pattern of slower household deposit growth alongside faster non-bank deposit growth persisted. Industry insiders said this does not mean that money is leaving the banking system, nor does...
Spring Festival 2026 Consumer Sales Jump 13.7% YoY
1/3 Xinhua: "According to China's value-added tax invoice data, the 2026 Spring Festival holiday saw the average daily sales revenues of consumer-related industries increase by 13.7 percent from last year's Spring Festival holiday." https://t.co/kWT8ZTr29T
China’s USD Pullback Demands over $100B Monthly Liquidity
Setser: "$100b a month is a large sum, it had to go into a fairly liquid corner of the market". And of course if on top of this China really were reducing its exposure to USD assets, we would need more...
China’s Lunar New Year Spending Modestly up Amid Stimulus
SCMP: "Consumer spending during China’s Lunar New Year rose modestly this year, according to early official data, as authorities extended the holiday and stepped up stimulus measures to support domestic demand." https://t.co/d5LzFaVd4V via @scmpnews
Universal Tariff Beats Currency Devaluation for Trade Balance
The irony is that to reduce trade imbalances, tariffs should mostly substitute for currency devaluation, in which case a single, universal tariff is likely to be far more effective than a hodgepodge of bilateral and sectoral tariffs. https://t.co/QVpoGNLwuH
Countries Subsidize Exports, Cutting Domestic Consumption to Offset US Tariffs
1/4 As this WSJ article points out, countries are keeping their exports competitive in the face of US tariffs by increasingly subsidizing them, with the subsidies ultimately being paid for in the form of suppressed consumption. https://t.co/phOREv8G8z
China’s Top Solar Firms Slash One‑third Staff Amid Losses
1/7 Reuters: "China's biggest solar firms shed nearly one-third of their workforces last year, company filings show, as one of the industries hand-picked by Beijing to drive economic growth grapples with falling prices and steep losses." https://t.co/BDS9UWJaXO
Accelerating Trade Imbalances Will Deepen Global Tensions
Good PIIE paper by Tamim Bayoumi and Joseph E. Gagnon on the consequences of accelerating trade imbalances. They warn that trade tensions are likely to get worse, something I have been saying for years and continue to say. I don't...
China’s Overlapping Industries Amplify Industrial Policy Impact
Kyle Chan: "China’s strength across multiple overlapping industries creates a compounding effect for its industrial policy efforts." https://t.co/1Z2o8dcRWq
German Firms Decry China's Unfair, Destabilising Trade Practices
Reuters: "German businesses warned of what they called destabilising and unfair global business practices by China, accusing Beijing of driving overcapacity, massive subsidies, distortive foreign-exchange policies and politically motivated export controls. https://t.co/701kYKGi2T
97% of Chinese Megacities Now Have High‑speed Rail
SCMP: "High-speed rail services are already accessible in 97 per cent of Chinese cities with populations of more than 500,000, the State Council said in December." https://t.co/bD3P6HUata
China‑Africa Trade Hits $348B, Chinese Exports Surge
According to the China Global South Project, in 2025, trade between China and Africa reached $348 billion, a 17.7% increase from 2024. Chinese exports to Africa rose 25.8% to $225 billion, while African exports to China rose 5.4% to $123 billion. https://t.co/RFFOLMKVsP
Protecting Domestic EVs Requires Tariffs or Local Content Rules
Very good Rhodium piece on the cost advantage of Chinese EVs: “In practice, countries seeking to protect domestic industries have two broad options. One is to impose very high tariffs that account not only for subsidies but also for structural...
China’s Growth Model Shift Faces Deep Structural Hurdles
Now that there is a consensus on what has caused the imbalances and why they are so damaging to China and to the global economy, we have to begin to understand just why it will be so difficult for China...
China’s Hidden Subsidies Dwarf IMF’s 4% Estimate
FT: “The IMF estimated that China spends about 4 per cent of its GDP subsidising companies in critical sectors, and said it should reduce that by 2 percentage points in the medium term.” This is a start, of course, but just...
Neoliberalism Crafts Rules to Shield Global Capitalism From Democracy
I just finished Quinn Slobodian's fascinating book on the parallel evolution of globalization and neoliberalism, with the former (according to the latter) requiring specific rules and institutions to "protect" global capitalism from democratic political pressures. While he focuses very heavily...
2025 Year-End Bonuses Shrink, Uneven Amid Economic Slowdown
1/2 SCMP: "Long viewed by Chinese employees as a barometer of corporate prospects, industry momentum and even the broader economy, the year-end bonus packages for 2025 have become smaller, rarer and far more unevenly distributed, amid slowing... https://t.co/MFbnMtmZdY
US Controls Slow China, Ignite Homegrown Chip Drive
NYT: "While Washington’s export controls have slowed China’s chip development, they have added fuel to Beijing’s decade-long push to make strategic technologies like semiconductors and A.I. entirely at home." https://t.co/OcHRXob06N
WTO Warns China's $1.2T Surplus Unsustainable, Urges Model Shift
1/2 AFP: "WTO chief Ngozi Okonjo-Iweala on Friday urged China to change its growth model, arguing that its soaring trade surplus risked sparking new trade barriers. “The $1.2 trillion trade surplus is not sustainable because the rest of the world cannot... https://t.co/fvOrE6LYBH
EU Trade Surplus Shrinks as Tariffs and China Pressure
1/5 Reuters: "The EU's trade surplus kept shrinking, data showed on Friday, as tariffs weighed on exports to the U.S. and rising Chinese imports crowded out domestic production, highlighting existential threats to the bloc's economic model." https://t.co/91sJO2nGjP
Provincial Revenues Forecast 2‑3% Growth, Lagging Economy
1/4 SCMP: "Major provinces are budgeting for 2 to 3 per cent growth this year in general public operating revenue, broadly in line with last year but below broader economic growth targets, Fitch Ratings said in a research note." https://t.co/HwyAPw042O
China Cracks Down on Hidden Corporate IOU Market
1/3 Very interesting Caixin article on attempts by Chinese regulators to get their arms around "the opaque market for corporate IOUs that has allowed big-name companies to defer payments to suppliers on a massive scale." https://t.co/FIJywKAtIX
China's January Financing Jumps 2.4% Year‑over‑year, Beating Forecasts
1/5 According to Caixin, China’s aggregate financing grew slightly faster than expected in January, rising by RMB 7.22 trillion. This was 2.4% more than in January 2025 and 10.4% more than in January 2024. It is equal to 5.1% of annual...
China's Railway Investment Climbs 5.5% in January
Xinhua: "China's railway sector completed 46.3 billion yuan (about 6.67 billion U.S. dollars) in fixed-asset investment in January, up 5.5 percent year on year." https://t.co/g109GF2REm
US Firms and Consumers Shoulder Most 2025 Tariff Burden
1/5 The New York Fed finds that "U.S. firms and consumers continue to bear the bulk of the economic burden of the high tariffs imposed in 2025." https://t.co/X3Xz2tRn1j
Distinguish Inefficiency From Global Uncompetitiveness in EU Manufacturing
1/7 My latest piece was written for friends who are EU policymakers or advisors. In it I argue that there is a difference between an inefficient manufacturing sector and a globally uncompetitive manufacturing sector. We shouldn't conflate the two. https://t.co/qer7BAvgnc
State Firms Snap up Foreclosed Homes, Easing Oversupply
1/2 Reuters: "Chinese state-owned companies are buying foreclosed property projects, in a sign that long-promised government efforts to reduce massive oversupply in the crisis-hit housing sector are finally getting traction, albeit at a slow pace." https://t.co/Nk0gtgJVgr
January Home Prices Slip Across All Chinese City Tiers
Xinhua: In four first-tier cities and 31 second-tier cities, the average month-on-month price declines in January were 0.3% for new homes and 0.5% for resold homes, while prices in 35 third-tier cities fell 0.4% for new homes and 0.6% for...
EU Mulls 30% Tariff or Euro Devaluation to Counter China
1/5 Reuters: "The EU should consider either an unprecedented 30% across-the-board tariff on Chinese goods or a 30% depreciation of the euro against the renminbi to counter a flood of cheap imports, a French government strategy report said on Monday." https://t.co/1HcSSyRLJx
China's Growth May Slip to 2.5% without Action
1/11 SCMP: "China’s potential growth rate could fall to about 2.5 per cent in the coming years unless action is taken, prominent Chinese economist Zhou Tianyong has warned." https://t.co/9xqpRhz105