Home » China’s economic slowdown looks bad at home and abroad | PMI | RMB deposits | Foreign currency deposits

China’s economic slowdown looks bad at home and abroad | PMI | RMB deposits | Foreign currency deposits

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[Epoch Times August 20, 2021](Epoch Times reporter Zhang Wan comprehensive report) According to China’s July economic performance data recently released by the Chinese Communist Party, China’s industrial production, consumption and investment all show insufficient momentum and slow growth. Exceeding expectations, many financial institutions lowered their expectations for the Chinese economy again. At the same time, in China, both private enterprises and ordinary people are pessimistic about the prospects.

According to the official data released on August 16, China’s industrial value added above designated size in July increased by 6.4% year-on-year, total retail sales of consumer goods increased by 8.5% year-on-year in July, and fixed asset investment increased by 10.3% year-on-year in the first seven months of this year. All are below expectations. The value added of industrial enterprises above designated size refers to industrial enterprises with an annual income of 20 million (about 3.08 million US dollars). Reuters had previously expected the growth of these three indicators to be 7.8%, 11.5% and 11.3% respectively.

In addition to consumption and investment, the export volume of another troika, which is known as driving China’s economy, did not increase as much as expected in July. The Purchasing Managers Index (PMI), which reflects the prosperity of industrial production activities, and China’s manufacturing export new orders index both declined for the fourth consecutive month in July.

Before the release of the latest economic data, many economic institutions have begun to lower their expectations for China’s economic growth.

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After the July data was released, Goldman Sachs lowered its full-year economic growth forecast for China from 8.6% to 8.3%, and JPMorgan Chase lowered its full-year forecast from 9.1% to 8.9%. In addition to the weak performance of China’s economic data, these financial institutions believe that China’s “zero tolerance” epidemic prevention model is hurting China’s manufacturing and consumer spending.

According to a report by the Voice of America on August 14, a report by the political risk consulting firm Eurasia Group stated that the CCP has made effective containment of the Chinese Communist virus (COVID-19) the core content of its internal and external publicity. The report predicts that before the Beijing Winter Olympics in February next year, the Chinese Communist Party may not adopt more flexible epidemic prevention measures.

Capital Macros’ chief economist Neil Shearing pointed out in an analysis report last week that China’s long-term economic loss in sticking to the zero-clearing goal will be disastrous. If this mode of epidemic prevention is not changed, China will have to implement local blockades and restrict operations from time to time.

While foreign investment banks have lowered their expectations, in China, many large private companies have recently been punished under the supervision of the Chinese Communist authorities, and the investment enthusiasm of private companies has been greatly reduced.

According to the preliminary statistics of the Central Bank of the Communist Party of China, China’s social financing increase in July was 1.06 trillion yuan (approximately US$163.8 billion), a year-on-year decrease of 636.2 billion yuan (approximately US$98.3 billion). The 10.7% year-on-year growth rate of the stock of social financing is the lowest since the outbreak last year.

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Chinese economist Xiang Songzuo said in a speech at the Shanghai 2021 NetEase Economic Forum Summit on August 12 that the main investors in China’s economy are no longer the government and state-owned enterprises, but private enterprises. Private enterprises have contributed more than 85 percent. % Of manufacturing investment. The current insufficient investment demand in China is due to the fact that private enterprises not only have no confidence in the future, but are more anxious and worried.

Xiang Songzuo also said that the lack of consumer demand of the Chinese people is due to their very pessimistic expectations of future income.

Free Asia quoted some experts and scholars as saying on August 12 that the CCP’s official announcement of the reduction of RMB and foreign currency deposits also reflects the distrust of the government and the disappointment of the CCP’s policies. At the same time, they also feel that putting money in banks may not keep up with price inflation. .

According to the latest data from the Central Bank of the Communist Party of China, in July, RMB deposits and foreign currency deposits decreased by 1.13 trillion and 23 billion U.S. dollars, respectively. @

Editor in charge: Shao Yi

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