Premier Li Keqiang has called several State Council meetings to address “reform.” His emphasis has been on streamlining approvals in ministries and departments. By one estimate, some 1,700 items require approval and licensing; he’s promising to cut that number by a third. Li has also repeatedly called ...

Since growth keeps slowing – and the 0.4 pp q/q drop to 7.7% in Q1 was greater than expected – we’ve lowered our growth projections for 2013 and 2014. Falling industrial output, consumer spending and export growth have taken their toll. Growth may rebound to 8% by yearend, and intensify a bit in 2014....

It is increasingly clear that President Xi Jinping would like to maintain “political continuity.” And he’s showing international ambitions, too. He made his first foreign trip, to Russia, after taking full power in mid-March. That was aimed at deepening ties that might secure energy and weapon supplies....

President Xi Jinping and Prime Minister Li Keqiang have been accorded full power to run China’s party-state system. Xi is enthusiastically promoting anew "Chinese Dream" rhetoric, while Li is trying to build an image as a "reform-minded" leader. In a press conference after the mid-March party Congress,

Apparently concerned over rising housing prices in big cities, the State Council met in mid-February to discuss tightening control over property market demand. This shows that, contrary to market expectations of monetary policy relaxation, both the State Council and the Central Bank are determined to ...

Chinese GDP slowed significantly in 2012, to 7.8%, from 9.2% in 2011. Though this is big drop, we’re still believers in a soft landing. We project GDP will grow 8.2% this year, and 8.5% in 2014. We expect neither slowdown nor surge. Why we think so: investment and consumption both grew faster last ...

Economic performance was basically flat as the year ended, and major economic policy decision making was left on hold. January is likewise a quiet month in Chinese politics and economics. Stability may suggest that the recovery seen in earlier months is continuing. Industrial output grew 10% in the ...

It’s too soon to analyze the mindset of China’s new leadership: December through February is a transitional period, when key appointments are being made. Vice premiers being chosen to lead industry, agriculture, finance and trade; ministers are being tapped to oversee the Treasury and Central Bank. ...

With new leadership emerging from the Communist Party’s 18th Congress, the basic governance framework for the next decade is coalescing. Xi Jinping is the new party chief, and Li Keqiang is expected to assume the premiership next March. The expectation is that each will serve for two terms (or 10 years),

There are signs that economic slowdown is nearing an end, and that China could soon recover its pattern of steady growth. GDP grew 7.7% in the year to Q3, and 7.5% y/y in Q3. The latter figure was flat on Q2. Fixed asset investment rose 18.8% in the year to Q3, up 0.8 pps from Q2. The slowdown in real ...

The news that GDP grew 7.4% y/y in Q3 wasn’t really disappointing, since some analysts expected further slowdown. We see signs of stability emerging, and there are hopes that growth won’t slide further in Q4. Most hope is being pinned on the acceleration of investment growth. Fixed asset investment ...

The Sino-Japanese dispute over Diaoyu Island is taking an economic toll on China. Bilateral trade is likely to be hardest hit, followed by manufacturing. Parts of the retail market will also suffer. Though the situation is unlikely to spin out of control, the negative impacts are likely to last for ...

Though the Politburo has announced that authorities are making economic growth a higher priority, Premier Wen Jiabao’s recent comment that “economic difficulties may continue for a while” may be intended to lower public expectations of a major policy shift, and quick economic turnaround. Meanwhile,

We think China’s slowdown has bottomed out, with GDP growth of 7.8% y/y in H1. Several indicators suggest recovery, and a return to faster growth. The uptick will likely be led by property prices, with which investment could start rebounding before yearend. Fixed asset investment was off slightly ...

We detect signs of a policy shift: with worse-than-expected economic performance in Q2, Premier Wen Jiabao and his second in commend have stepped up their interest in the macro economy, and have toured the provinces to speak with regional leaders. They are said to be planning a major mid-year economic ...

While China has begun to relax its macroeconomic policy – cutting interest rates and the deposit reserve requirement - it’s apparent that Beijing isn’t planning any major 2008-2009-style stimulus. Some fiscal measures have been introduced. But the nine members of the Standing Committee have been busy ...

The macroeconomic landscape is changing fast, with the prospects for quick stabilization uncertain. Many economic indicators suggest weakening, with some numbers dropping more than expected. Though we consider this a market correction, we believe effects should be addressed via urgent policy easing....

Growth has been slowing a bit faster than expected, due to a plunge in consumption and export growth. GDP grew 8.1% y/y in Q1, down significantly from last year’s 9.2%. Retail sales of consumer goods rose 10.9% y/y in Q1, down 1.7 pps from Q4. Commodity exports in dollar terms increased 7.6% y/y in ...

The Chinese political scene quieted in April, after the events surrounding Bo Xilai and Wang Lijun. We attribute this to intensive Party efforts to minimize any undesirable effects on the transition of power scheduled to take place before the end of the year. Whether consensus among top political leaders ...

A political shakeup in the Politburo suggests that the competition for leadership posts has intensified. The ouster of left-leaning Chongqing party secretary Bo Xilai, whose aide immediately afterward requested asylum from the United States, suggests that the nine-member Politburo leadership is uninterested ...

January was an unusual month: there were only 14 to 16 working days, far fewer than last year, since Chinese New Year fell earlier. We think this pushed many economic indicators, especially for production and investment, down significantly. The calendar seems to have created significant seasonal effects....

GDP grew 9.2% in 2011 to Q4, and 8.9% for the year. Growth slowed steadily but moderately throughout the year, a trend that should be regarded as a return to normal growth patterns. We expect GDP growth to keep slowing in 2012, but less aggressively, and project GDP growth at 8.7%. The main causes ...

China’s GDP growth is slowing, and we expect the slowdown to persist in H1, lowering growth to 8.5% this year. Industrial output was up 13.9% in 2011 to December, down 0.1 pps from November, and 1.8 pps lower than for the same period in 2010. Fixed asset investment rose 17.1% in 2011 to December, also ...

The high-level Central Economic Work Conference has set forth the basic line for next year’s macroeconomic policy: “Moving forward by maintaining stability.” The group’s communiqué also stated that government would adopt a “pro-active fiscal policy and prudent monetary policy.” This is in effect a compromise,

Though pessimistic rhetoric is rising, the main economic indicators for October actually show robust signs of stabilization. Industrial growth was up 14.1% in the year to October, down just 0.1 pps from September. If there had been no supply constraints, such as electricity shortages, growth would ...