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☆ China is home to one of the world's biggest luxury markets, and it's starting to make a comeback after the country's 3-year COVID lockdowns
▼ + stars: | 2023-04-12 | by ( Nidhi Pandurangi | ) www.businessinsider.com time to read: +3 min

China is an important luxury market. Bain expects these consumers will account for 46% of the global luxury market by 2025. However, Wu's comments echoed Bain's positive outlook for China's luxury market. China's consumer price index, or CPI — the monthly change in prices paid by consumers — showed bleak data for March. It could be the reason Bank of America's Wu told CNBC that strong recovery across China's consumer sector has not yet been seen.

☆ China's debt-heavy local governments look for new ways to raise cash
▼ + stars: | 2023-03-27 | by ( Evelyn Cheng | ) www.cnbc.com time to read: +5 min

Future Publishing | Future Publishing | Getty ImagesBEIJING — Debt-heavy local governments in China need new ways to raise money under a central regime that's made clear its priority is to reduce financial risks. "We should ... prevent a build-up of new debts while working to reduce existing ones," the report said regarding local governments' situation. S&P and other analysts estimate land sales account for about a quarter of local governments' total revenue. But local governments still have bills and public services to pay for. Historically, local governments were responsible for more than 85% of expenditure but only received about 60% of tax revenue, Rhodium Group said in 2021.

☆ China keeps lending benchmarks unchanged in March, as expected
▼ + stars: | 2023-03-20 | by ( Reuters Staff | ) www.reuters.com time to read: +3 min

SHANGHAI (Reuters) - China kept its benchmark lending rates unchanged for the seventh straight month in March, as expected, with the economy already benefiting from policy actions taken last week as it recovers from the pandemic. On Monday, the one-year loan prime rate (LPR) was kept at 3.65%, while the five-year LPR was unchanged at 4.30%. (Graphic: China lending rates unchanged in March here)In a Reuters poll conducted last week, all 22 participants predicted no change to either loan prime rate. “The central bank’s RRR cut was more of an emergency response to prevent overseas banking crisis from spilling over to China,” Xing said. An RRR cut nonetheless also promotes economic growth, so economists thought that last week’s made an LPR cut less likely.

Starbucks (SBUX.O) warned of a "cautious" recovery in its China sales. "Consumers have become more meticulous in their spending," its chief executive, Xu Lei, said in an earnings call on Thursday. "Now the Chinese tourists are either super rich or very poor," said the owner, who spoke on condition of anonymity. "This suggests that once the initial reopening rebound has happened, we shouldn't expect a further surge in consumer spending," he wrote in a note to clients. ($1 = 6.8780 Chinese yuan renminbi)Editing by Marius Zaharia and Bradley PerrettOur Standards: The Thomson Reuters Trust Principles.

As debt obligations mount, some local governments are pushing banks to extend maturities and cut interest rates, sources said. Reuters Graphics"BLACK HOLES""The LGFVs have become the black hole of the Chinese financial system. Chinese banks and other financial institutions have been cautious on new lending to LGFVs over the past years. In recent months, some state-owned banks, asset managers, and insurers have been looking into their portfolios to screen LGFV borrowers with weaker creditworthiness and dispose them, separate financial sector sources told Reuters. Offshore branches of Chinese financial institutions have been major buyers of the bonds, industry sources said.

[1/7] Farmer Wang Zhanling sits next to his wife in their house in Quansheng village, Heilongjiang Province, China, February 8, 2023. The state-run Chinese Academy of Sciences sees the pension system running out of money by 2035. "If the pension system does not change, this is unsustainable," said Xiujian Peng, senior research fellow in the Centre of Policy Studies at Victoria University in Australia. The province has the lowest birth rate in China, with just over 100,000 births in 2021 and 460,000 deaths. Many experts, including Macquarie's chief China economist Larry Hu, suggest implementing a unified national pension system, backstopped by the more resourceful central government rather than cash-strapped local administrations.

☆ Reopening to recovery: Goldman Sachs sees China stocks surging as much as 24% by end of 2023
▼ + stars: | 2023-02-20 | by ( Jihye Lee | ) www.cnbc.com time to read: +1 min

BEIJING, CHINA - FEBRUARY 09: Citizens walk at Wangfujing Pedestrian Street in the snow on February 9, 2023 in Beijing, China. Goldman Sachs strategists see an economic shift from "reopening to recovery" driving Chinese stocks as much as 24% higher by the end of this year. The firm sees a potential 24% upside to the MSCI China index as the country moves past the reopening that followed its stringent zero-Covid policies to a growth phase, according to a Monday note. Chinese stocks entered bull market territory around the Lunar New Year earlier this year – with the MSCI China index peaking at the end of January up nearly 60% from lows seen in October. MSCI China tracks more than 700 China stocks listed globally, including Tencent, BYD and Industrial and Commercial Bank of China.

☆ China's economic recovery is off to a slow start
▼ + stars: | 2023-02-15 | by ( Evelyn Cheng | ) www.cnbc.com time to read: +3 min

Hector Retamal | Afp | Getty ImagesBEIJING — China's economic recovery is off to a modest start. Migrant workers have mostly returned to work after China's biggest holiday of the year, and children went back to school this week. It also remains to be seen how demand from China's growth picks up as businesses resume work and travel after the Lunar New Year holiday. Robin Xing, chief China economist at Morgan Stanley, pointed out that in-person meetings are particularly important for doing business in China, and that such interactions weren't easily feasible last year. Ting Lu chief China economist, Nomura

But retail investors are haunted by the regulatory purges, volatility and losses since 2021. With 212 million retail investors, equal to Brazil's population, the conservatism of China's retail army has implications for the viability of the rally. Individual retail investor transactions accounted for about 60% of the total A-shares turnover in late 2022, China Securities Regulatory Commission Chairman Yi Huiman said in November. But data shows barely any investor accounts being opened and the margin financing that retail investors typically use has plateaued. Retail investors are waiting for clearer policy signals, said Lei Meng, China equities strategist at UBS Securities.

☆ 'The worst is over': Tech investors are bullish on investing in China again
▼ + stars: | 2023-02-07 | by ( Sheila Chiang | ) www.cnbc.com time to read: +5 min

Liu Ranyang | China News Service | Getty ImagesTech investors say the worst is over as China reopens and exits its zero-Covid policy. The firm raised nearly $500 million for a new China tech fund set to close by early this year — more than earlier plans for $400 million. Tech companies see government supportInvestors are not worried of new challenges on the regulatory front. Gobi's Tang said, "I do think that they're going to do everything they can to try to spur the economic growth. "There's still a lot to catch up [in semiconductor tech] for China.

☆ China looks past Covid as tourist bookings surge for the Lunar New Year
▼ + stars: | 2023-01-27 | by ( Evelyn Cheng | ) www.cnbc.com time to read: +1 min

BEIJING — People in China are moving past the pandemic and going out to travel, preliminary data for the Lunar New Year holiday show. China's Covid "exit wave" is quickly ending as official data show a drop in infections, hospitalizations and deaths, he said. "China has been rapidly reaching its Covid herd immunity, as the government estimates about 80% of the population has already been infected with Covid." The country saw a surge in Covid infections in December, just as Beijing ended nearly three years of stringent contact tracing and border controls. The seven-day Lunar New Year, which officially began Saturday, is the first major holiday since the end of China's Covid restrictions.

☆ Morgan Stanley says China's market will be the biggest winner in 2023 and these stocks stand out
▼ + stars: | 2023-01-20 | by ( Zavier Ong | ) www.cnbc.com time to read: +3 min

Since the turn of the year, investment banks have become increasingly bullish on the world's second-largest economy, upgrading their outlook on its stocks. But Morgan Stanley is going even further: It's predicting that Chinese stocks will beat global markets this year. "This actually implies that the Chinese equity market will top global equity market performance for 2023. So, this is the time to get back into China," Wang said. Stock picks Wang said the "number one trade" she would recommend to investors is to buy "large-cap, highly liquid" Chinese internet names.

☆ China's economy could recover faster and earlier than expected, analysts say
▼ + stars: | 2023-01-17 | by ( Jihye Lee | ) www.cnbc.com time to read: +3 min

The nation's economy grew 3% for the full year of 2022 — the second-slowest growth rate it has seen since 1976. The nation's economy grew 3% for the full year of 2022 — the second-slowest growth rate it has seen since 1976. Xu expects to see a sharp rebound in the second quarter of 2023 as China continues to prioritize the economy over its zero-Covid policy. China's economy may have already seen the worst of pressures in the final month of 2022, JPMorgan's Zhu said. He added the weakness was the result of uncertainty surrounding the nation's zero-Covid policy and a mass infection that followed its steps of reopening.

☆ China's exports, imports shrink again in Dec on weakening global demand
▼ + stars: | 2023-01-13 | by ( ) www.reuters.com time to read: +4 min

SummarySummary Companies China's Dec exports worst since Feb 2020, slightly better than forecastImports tumble by smaller margin amid lacklustre demandDomestic demand should slowly recover after zero-COVID scrappedExport outlook gloomy in 2023, major threat to China's growthBEIJING, Jan 13 (Reuters) - China's exports shrank sharply in December as global demand cooled, missing their typical year-end bounce, while imports tumbled again as surging COVID-19 infections and a property downturn weighed heavily on domestic demand. WEAK GLOBAL DEMAND COULD TEMPER ECONOMIC RECOVERYChina's commerce ministry said on Thursday that slowing external demand and the rising risks of a global recession are posing the biggest pressures to the country's trade stabilisation, leaving "arduous tasks." REBOUNDAnalysts polled by Reuters expect China's economic growth to rebound to 4.9% in 2023, before steadying in 2024, a Reuters poll showed. Jin Chaofeng, whose company in the east coast city of Hangzhou exports outdoor rattan furniture, said he has no market expansion or hiring plans for 2023 as he remains cautious about the global demand outlook. "With the lifting of COVID curbs, domestic demand is expected to improve but not for exports...," he said.

☆ China growth seen rebounding to 4.9% in 2023, more stimulus on the cards: Reuters poll
▼ + stars: | 2023-01-12 | by ( Kevin Yao | ) www.reuters.com time to read: +4 min

"We expect economic activities and consumption to rebound strongly from March-April onwards, helped by post-COVID re-opening and release of excess savings," Tao Wang, chief China economist at UBS, said in a research note. Reuters GraphicsThe expected 2022 growth rate would be far below the official target of around of 5.5%. China is likely to aim for economic growth of at least 5% in 2023 to keep a lid on unemployment, policy sources said. "Economic policy would turn more supportive in 2023. Consumer inflation will likely quicken to 2.3% in 2023 from 2.0% in 2022, before steadying in 2024, the poll showed.

Shifts in tones at big banks suggest they are warming up to Chinese equities, especially as the strong returns so far and the fear of missing out on more gains start to apply pressure. "This is still a long path and we remain very bullish on Chinese equities ...and also the currency," he said. "When the market goes up, naturally that will attract international investors to look at China again," said Nicholas Yeo, head of China equities at abrdn. Foreign investors bought a net 41 billion yuan ($6.06 billion) of China stocks via the China-Hong Kong Stock Connect Scheme so far this year, compared with 90 billion yuan of China stocks bought in all of 2022. They bought a net 35 billion yuan of China stocks in December.

☆ China's big cities are starting to look past Covid, while rural areas brace for infections
▼ + stars: | 2023-01-06 | by ( Evelyn Cheng | ) www.cnbc.com time to read: +4 min

Subway passenger traffic in Shanghai is quickly returning to levels seen before the latest Covid wave, according to Wind data. Subway and road data show traffic in major cities is rebounding, he pointed out, indicating the worst of the latest Covid wave has passed. "The dramatic U-turn in China's Covid policy since mid-Nov implies deeper short-term economic contraction but faster reopening and recovery," Hu said in a report Wednesday. In the last several days, the southern city of Guangzhou and the tourist destination of Sanya said they'd passed the peak of the Covid wave. watch nowChongqing was the most congested city in mainland China during Thursday morning's rush hour, according to Baidu traffic data.

Property investment in November fell the fastest since the statistics bureau began compiling data in 2000, down 19.9% on year. "Although property sales and starts will likely be slightly weaker than in 2022, property will be much less of a drag on the economy than in 2022." Reuters GraphicsHOUSING DEMANDShares in embattled Chinese property developers have gained 86% since the trough in October, buoyed by a string of property easing measures and the COVID policy u-turn. "We may be close to see some bottoming out in housing demand …but I don't think we're quite there yet," he said. The latest China Beige Book private economic survey was more blunt: "But forget a return to days of old: it will take considerable policy support in 2023 just to pull property out of the gutter."

☆ China's economy looks different than it was going into the pandemic
▼ + stars: | 2022-12-22 | by ( Evelyn Cheng | ) www.cnbc.com time to read: +4 min

China's exports started to fall year-on-year in October — for the first time since May 2020, according to Wind Information. Net exports had supported China's GDP growth over the last several years, contributing as much as 1.7 percentage points in 2021, the analysts said. But China's exports to the Association of Southeast Asian Nations have picked up, surpassing those to the U.S. and EU on a monthly basis in November, according to customs data. They expect ASEAN's GDP growth to rebound in 2023, while the U.S. and EU spend part of next year in recession. Jin pointed out that China's car exports, especially of electric cars and related parts, helped support overall exports this year.

☆ China’s sudden ‘reopening’ reveals new challenges as infections soar
▼ + stars: | 2022-12-16 | by ( Evelyn Cheng | ) www.cnbc.com time to read: +4 min

Yuxuan Zhang | Afp | Getty ImagesBEIJING — Mainland China's swift rollback of many Covid-related restrictions has been unexpectedly sudden, revealing a new set of economic challenges. “Surging Covid infections may offset the positive impact of the easing in the near term." "The rapid surge of infections in big cities might be only the beginning of a massive wave of Covid infections," the analysts said. Get through winter firstSocial activity remains subdued amid the surge of infections and below-freezing weather in northern cities. Management at Chinese travel booking site Trip.com were also reserved in how soon domestic travel would rebound.

SHANGHAI/HONG KONG, Dec 9 (Reuters) - Investors caught off-guard by China's dramatic COVID policy pivot are betting on both greed and fear as the economy starts to gradually reopen, snapping up shares in businesses from travel agencies and casinos to funeral companies. Providers of death care services, including Hong Kong-listed Fu Shou Yuan International Group (1448.HK), China's biggest cemetery operator and funeral service provider, have also drawn investors. The positioning for both the bright and dark side of China's COVID pivot reflects growing concerns from investors surprised by the rapid policy change, especially as COVID vaccination rates among the elderly remain relatively low. "But we still think that the way China can flatten the curve of new COVID cases without doubling down on tightening looks quite challenging." Morgan Stanley Chief China economist Robin Xing said China's economy may remain sluggish for another quarter or two, but growth will pick up after Spring.

☆ China's reopening from Covid won't be a straight path forward
▼ + stars: | 2022-12-09 | by ( Evelyn Cheng | ) www.cnbc.com time to read: +5 min

Hector Retamal | Afp | Getty ImagesBEIJING — As mainland China relaxes many of its stringent Covid controls, analysts point out the country is far from a quick return to a pre-pandemic situation. Mainland China's daily Covid infections, mostly asymptomatic, surged to a record high above 40,000 in late November. Looking ahead, it's pretty clear that China's Covid policy is about to cross a turning point, said Bruce Pang, chief economist and head of research for Greater China at JLL. That means there may be a surge in Covid infections, and China's policy will never go back, Pang said. Goldman Sachs analysts expect China's reopening — defined as a shift away from lockdowns — to come in the second quarter of 2023, according to a separate report on Wednesday.

☆ China's Covid lockdowns are having a lessening impact on its economy
▼ + stars: | 2022-12-06 | by ( Evelyn Cheng | ) www.cnbc.com time to read: +1 min

BEIJING — China's Covid lockdowns are having a lessening impact on the economy for the first time since early October, according to Nomura. Evelyn's lead: The negative impact of China's Covid controls on GDP has dropped for the first time since early October, according to a Nomura model. As of Monday, the negative impact of China's Covid controls on its economy fell to 19.3% of China's total GDP — down from 25.1% a week ago, Nomura's Chief China Economist Ting Lu and a team said in a report. Last week's 25.1% figure was higher than that seen during the two-month Shanghai lockdown in the spring, according to Nomura's model. In the last several days, local governments have relaxed some virus testing requirements, allowing people in cities such as Beijing and Zhengzhou to take public transportation without having to show proof of a negative test result.

☆ China signals slight Covid policy easing — but don't expect sweeping changes yet
▼ + stars: | 2022-12-01 | by ( Evelyn Cheng | ) www.cnbc.com time to read: +1 min

Customers dine in at a McDonald's in Guangzhou on Dec. 1, 2022, a day after the city eased Covid restrictions on restaurant operations. BEIJING — A trickle of changes around China's Covid controls in the last 24 hours has raised hopes that broader relaxation is on its way. Local state media reports and anecdotes indicated Thursday that some people who tested positive for Covid-19 in Beijing might now be allowed to quarantine at home instead of being sent to a centralized facility. That's according to a CNBC translation of the Chinese state media report late last night. Also on Wednesday, the Guangzhou city district hardest hit by Covid said it would allow most restaurants to resume in-store dining, and entertainment venues can gradually reopen.

☆ China's stocks, yuan tumble as COVID protests rattle nerves
▼ + stars: | 2022-11-28 | by ( ) www.reuters.com time to read: +4 min

A U.S. crackdown on Chinese tech giants citing national security concerns also weighed on shares of technology firms. Nevertheless, the social unrest and rising coronavirus cases had fuelled expectations of an earlier end to China's zero-COVID policy, putting a floor under stocks and boosting tourism and consumer shares. "The market does not like uncertainties that are difficult to price and the China protests clearly fall into this category. While state media has not reported the protests, photos and videos of the protests circulated on social media. "The demonstrations ... mean the current COVID policy mix is no longer politically sustainable.

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