Policymakers face two challenges.... Internally, policymakers' efforts to constrain the growth of shadow banking and reduce financial risks worked almost too well.
Financial regulations introduced in 2017 and early 2018 led to a meaningful contraction in shadow banking, which slowed overall credit growth and tightened credit conditions, particularly for private companies.
"And externally, the escalation in US tariffs raised questions about China's export growth and damaged confidence in the economic outlook. As a result, our China Current Activity Indicator has fallen nearly two percentage points from its 1H2018 average of over 7%.".
Retail sales growth is at its slowest since the peak of the crisis in Nov 2008 and industrial production is at its slowest since 2003.... And don't forget China's unsold car inventory is at a record high as car sales plunged for a sixth consecutive month, plummeting 18 percent in November, which would be the first annual decline since 1990 based on CAAM estimate.
It seems the crackdown on the shadow-banking system is hard to overcome it seems with even the most finely tuned hammer of monetary policy.... Albeit a stronger-than-estimate aggregate financing and new yuan loans released earlier this week, the slowdown of M1 money supply growth underscores worries over economy, which may prompt authorities to start doing more to support growth.
As Bloomberg's Enda Curran notes, while the numbers reinforce what we already know, that the economy is under pressure, the soft numbers indicate that there's a way to go yet before growth turns a corner.
It may be one reason why China is appearing to play ball in the trade talks.... And finally, before American investors crow that Trump's trade war is working and China's economy is suffering - the fact is that the US economic data is as dismal and disappointing as China's has been.....
https://www.zerohedge.com/news/2018-12-13/china-retail-sales-industrial-production-growth-plummet-november
Financial regulations introduced in 2017 and early 2018 led to a meaningful contraction in shadow banking, which slowed overall credit growth and tightened credit conditions, particularly for private companies.
"And externally, the escalation in US tariffs raised questions about China's export growth and damaged confidence in the economic outlook. As a result, our China Current Activity Indicator has fallen nearly two percentage points from its 1H2018 average of over 7%.".
Retail sales growth is at its slowest since the peak of the crisis in Nov 2008 and industrial production is at its slowest since 2003.... And don't forget China's unsold car inventory is at a record high as car sales plunged for a sixth consecutive month, plummeting 18 percent in November, which would be the first annual decline since 1990 based on CAAM estimate.
It seems the crackdown on the shadow-banking system is hard to overcome it seems with even the most finely tuned hammer of monetary policy.... Albeit a stronger-than-estimate aggregate financing and new yuan loans released earlier this week, the slowdown of M1 money supply growth underscores worries over economy, which may prompt authorities to start doing more to support growth.
As Bloomberg's Enda Curran notes, while the numbers reinforce what we already know, that the economy is under pressure, the soft numbers indicate that there's a way to go yet before growth turns a corner.
It may be one reason why China is appearing to play ball in the trade talks.... And finally, before American investors crow that Trump's trade war is working and China's economy is suffering - the fact is that the US economic data is as dismal and disappointing as China's has been.....
https://www.zerohedge.com/news/2018-12-13/china-retail-sales-industrial-production-growth-plummet-november
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