Subtitle: Understand China's current economic state in 15 charts
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China's macroeconomic indicators have recently provided reasons for optimism. In a marked shift, inflation has inched up by 0.1% year-on-year, rising from negative territory from last month. The Producer Price Index (PPI) continues its trend of moderating declines. Since June, the year-on-year drop has been progressively narrowing, with August's figure at -3%, an improvement from the previous month's -4.4%. New yuan loans for August 2023 reached CNY 1.36 trillion, a significant leap from the CNY 0.35 trillion recorded in July.
Consumer confidence continues to recover, and the real estate sector, bolstered by recent stimulus measures, is also witnessing a recovery. (You will see charts on those in today's post).
Exports from China dropped 8.8% yoy in August 2023, after a 14.5% plunge in July, and better than forecasts of a 9.2% decline. This was the fourth straight month of decline in exports, amid weakening global demand.
Among major trade partners, China’s exports to the US fell by 9.53% from a year earlier, while those to the ASEAN countries, China's largest trade partner, and the EU dropped by 13.25% and 19.58%, respectively. Meanwhile, exports to Russia advanced 16%, after surging 52% in July and a 91% jump in June.
The trend raises eyebrows given that exports have historically been a pillar supporting China's economy, and the shifting global demand and trade partnerships intensify concerns, such as Mexico surpassing China as the U.S.'s primary trading partner.
Recruitment for overseas positions has been recovering since January 2023, pointing towards a possible rebound in exports.
China’s export to Mexico accelerated, particularly following US-China tensions, with substantial indirect intermediate goods being processed in Mexico for re-export to the US.
