China has allocated over 10.7 billion yuan to promote inclusive finance in 2023. The country's imports of energy, metals, and consumer goods have also increased, with commodities up 16.5% and consumer goods up 3.1%. Meanwhile, the digital yuan is boosting holiday consumption, with high redemption rates for digital coupons.
China's economic growth is showing sustained momentum, with experts predicting Q3 GDP growth to exceed 4%. The central bank is maintaining liquidity stability, and local financing platforms are transitioning towards market-oriented debt management. Meanwhile, the US economy remains optimistic despite risks, and Russia has implemented capital controls to stabilize the ruble.
China's tax cuts and fee reductions reached over 1.15 trillion yuan in the first eight months, significantly supporting the real economy. Meanwhile, auto exports, particularly electric vehicles, saw a substantial increase, with 82.5 million new energy vehicles exported from January to September.
In Q3, the China SME Development Index rebounded, indicating positive economic growth. Meanwhile, the Ministry of Commerce aims to enhance digital cooperation and trade relations with partner countries, including accelerating negotiations for the China-ASEAN FTA 3.0 version.
The US Department of Commerce added 42 Chinese companies to its export control list, citing support for Russia’s defense industry. Meanwhile, Anhui province launched 1089 major projects with a total investment of 707.46 billion yuan, focusing on manufacturing and high-tech industries. The third quarter saw a tightening in IPOs, with 12 consumer-related companies withdrawing their applications. Internationally, former US Treasury Secretary Larry Summers warned that the impact of Fed rate hikes is diminishing, increasing the risk of an economic hard landing. Saudi Arabia indicated it might take action to stabilize oil prices if they remain high.
During the 2023 Mid-Autumn and National Day holidays, China's domestic tourism saw a significant rebound with 8.26 billion tourist trips and a domestic tourism revenue of 753.43 billion yuan. The cultural and tourism industry showed strong recovery, reflecting robust consumer demand and economic resilience. Meanwhile, the U.S. non-farm payroll increased by 336,000 in September, exceeding expectations, and Germany's government revised its economic forecast to a 0.4% contraction for 2023.
Shanghai Port reported a 3.6% increase in container throughput to 32.14 million TEUs in the first eight months of 2023. Meanwhile, Australian consumer confidence remains low despite strong corporate performance, reflecting a stark contrast between businesses and households. The Japanese bond market is pricing in an end to negative interest rates by January 2024.
Offshore RMB recovered the 7.30 level against the USD, rising over 600 points. China's real loan balance reached 230.24 trillion yuan, growing 10.9% year-on-year. The PBOC vowed to maintain stability in the forex market and prevent speculative activities. Guangzhou became the first tier-1 city to break the LPR floor for first-home mortgages.
China's foreign exchange reserves decreased by 442 billion USD in August, totaling 31601 billion USD. Guangzhou became the first major city to break the LPR mortgage floor, offering lower interest rates for first-time homebuyers.
China's foreign exchange reserves fell to $31,601 billion in August, down 1.38% from July. Meanwhile, Shanghai introduced a new policy to support urban renewal projects using housing provident funds, and the People's Bank of China announced measures to reduce mortgage rates for first-time homebuyers.
The special group promoting stock market liquidity in China will meet to discuss easing listing thresholds. Meanwhile, the global manufacturing PMI has slightly recovered from August lows, indicating a weak economic recovery. Germany’s factory orders dropped significantly in Q3, and the Philippines is prepared to tighten monetary policy if needed.
China tightens the pace of IPOs, adjusts housing policies to support first-time homebuyers, and raises personal income tax deduction standards for childcare and elderly care. Meanwhile, the Eurozone faces inflation challenges, and the ECB is caught in a dilemma over interest rate hikes.
Wuxi has implemented a new policy where residents without a complete housing unit in the city will be eligible for first-home loan rates regardless of previous loans. Additionally, the RMB has become the fifth largest reserve and payment currency globally, marking significant progress in its internationalization.
China's industrial policies are advancing with new measures to boost economic recovery. The manufacturing sector shows promising prospects, while the growth of the services sector has slowed down. In international news, the global trade finance gap has reached a record high of $2.5 trillion, and the RBA kept interest rates unchanged due to declining inflation.
In August, local government bond issuance hit a new high of about 1.3 trillion yuan, driven by accelerated special bond issuance. The People's Bank of China, Beijing branch, is studying an LPR reform plan for existing housing loans, to be announced by September 25th.
