Financial Authorities Declarations
- Flash News !
-The National Food and Strategic Reserves Administration announced the 4th batch of metal release from national reserves scheduled for October soon. 30 000 tonnes of Copper, 70 000 tonnes of Aluminum and 50 000 tonnes of Zinc will be released to eligible manufacturers.
-Bank of China announced planning to boost credit support for green projects in 2021-2020 period providing at least 1 Trillion Yuan of funds.
- The CSRC approved IPO !
The China Securities Regulatory Commission. (CSRC) approved IPO on the Shanghai STAR market of Siglent Technologies CO., Ltd., Assure Tech (Hangzhou) Co., Ltd. and Aohua Endoscopy Co., Ltd.
- New data on Debts, External Debts and External financial activities !
|Local Gvt Bonds issuance||4.88||Trillion Yuan|
|-Special bond issuance||2.78||Trillion Yuan|
|-General Bonds Issuance||2,1||Trillion Yuan|
|Average interest rate||3,39%||per annun|
|Outstanding of Local Gvt Debts||28.47||Trillion Yuan|
|Official Limit||33.28||Trillion Yuan|
The State Administration of Foreign Exchange (SAFE) released data on the external debt outstanding denominated both in Yuan or in Foreign Currencies.
“All major external debt indicators were within the internationally recognized thresholds, and China’s external debt risk is under control” the State Administration of Foreign Exchange said.
|At the end of 2021 H1||Units||% of Total|
|Outstandin of Extrenal Debt||17.3119||Trillion Yuan||/|
|Medium Long Term debts||7.5707||Trillion Yuan||44%|
|Short run debts||9.7412||Trillion Yuan||56%|
|General Gvt debts||2.7486||Trillion Yuan||16%|
|Banks debts||8.1084||Trillion Yuan||47%|
|Balance of loans||3.0696||Trillion Yuan||18%|
|Currency and deposits||3.9773||Trillion Yuan||23%|
|At the end of 2021 H1|
|External financial assets||9.0278||Trillion USD|
|reserves assets||3.3459||Trillion USD|
|direct investment assets||2.462||Trillion USD|
|External Liabilities||7.0418||Trillion USD|
|Of Banking sector|
|External Financial Assets||1.5415||Trillion USD|
|External Liabilities||1.6487||Trillion USD|
SAFE also issued data on external portfolio investment assets held by resident at the end of 2020.
|2020||Units||% of Total|
|External Portfolio investment||899.9||Billion USD||/|
|Non-Financial sector||354.3||Billion USD||39%|
|Non-Financial institution||354.1||Billion USD||39%|
|In Equity||604.3||Billion USD||67%|
|In Bonds||295.5||Billion USD||33%|
- PMI data highlights contraction of Industry
|Manufacturing PMI||49.6||50 point basis|
|— growth||-0.5 pp||mom|
|High-Tec PMI||54||50 point basis|
|Non-Manufacturing PMI||53,2||50 point basis|
|— growth||+5.7 pp||mom|
|Services PMI||52.4||50 point basis|
|— growth||+7.2 pp||mom|
PMI contraction are explained by electricity cuts for energy intensive industry. These electricity cuts are mainly due to the energy mix of China still mainly based on coal. Despite that the country produce about 90% of its coal consumption the remaining 10% are imported and subjected to strong prices hikes in international markets. The marginal cost for power generation is then increasing as more electricity are asked by industry.
In addition, the recent adjustments of law urge industries to significantly reduce their consumption as a part of the green transition program and Carbon emissions reduction policy.
Central Bank Operations and declarations
|September 27||Reverse Repo||14-days||100 Billion Yuan||2.35%|
|September 28||Reverse Repo||14-days||100 Billion Yuan||2.35%|
|September 29||Reverse Repo||14-days||100 Billion Yuan||2.35%|
The People’s Bank of China conducted the 9th Central Bank Bills Swap operation in Hong Kong issuing 5 Billion Yuan at a 0.1% fixed interest rate due on December 29.
- PBOC and CBIRC tighter on Real Estate sector loans
The People’s Bank of China (PBOC) and the China Banking and Insurance Regulatory Commission (CBIRC) urged financial institution to cooperate with authorities to maintain stability of property market. The PBOC added that the main objective is to protect the rights and interests of consumers.
The PBOC reaffirmed its main leitmotiv “houses are for living in, not for speculation” while urging banks to better channel credit flow to in need sectors like manufacturing, private sector and SME. Authorities will carefully monitoring the full implementation of the 300 billion yuan of special central bank lending dedicated to support SME.
- PBOC optimistic for Green Finance development !
The PBOC note that green finance development play a key role in economic transformation indicating that the green loans surged +26.5% yoy to 14 Trillion Yuan at the end of 2021 Q2. In the first eight months of 2021, the country issuance of green bonds up 152% compare to 2020 reaching 350 Billion Yuan at the end of August (including 180 Billion Yuan of carbon-neutral bonds).
- To liberalization of Services Trade !
The Ministry of Commerce (MOC) declared considering a new shorter negative list for cross-border services trade in the Free-Trade Zones (FTZ) in a move to promote liberalization of trade in services.
“China will make continuous efforts to promote the level of opening-up, advance institutional innovation and strive to build FTZs with global influences”, said CHEN Hong a MOC official.
|Current Account Surplus||795||Billion Yuan|
|Financial Account excuding Reserves||183.5||Billion Yuan|
|Assets Reserves||549.3||Billion Yuan|
|Capital and Financial Accounts||-366||Billion Yuan|
Sources : Ministry of Finance, People’s Bank of China and the State Administration of Foreign Exchange, National Bureau of Statistics, Ministry of Commerce, Ministry of Finance, General Administration of Customs, State-owned Assets Supervision and Administration Commission