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China Economic Watch

This blog monitors ongoing developments in China's economy, analyzes the impact of policy changes, and informs readers about new PIIE research on China.

Recent Posts

Real Value of China’s FX Reserves is Essentially Flat

by | April 16th, 2015 | 11:31 am

There has been a lot of debate lately about China’s foreign exchange reserves, whether the People’s Bank of China has been intervening, and in which direction.  It appears from the data available that the PBoC has done little or no intervening in the exchange market.  Data released this week shows that the value of China’s FX […]

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Chart of the Week: Broad-based decline in China’s property market

by | April 7th, 2015 | 03:04 pm

Late last month, the People’s Bank of China announced a further easing of mortgage requirements. This reflects a growing concern from policymakers and many analysts1 about the extent of the slowdown in the property market. Rightfully so – aggregate housing prices are in the midst of the sharpest correction in a decade, and it does not […]

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Solar Power for the Chinese Market

by | March 9th, 2015 | 04:45 pm

The Chinese solar power industry first entered the market for mass production of solar panels in 2004. The industry  has since grown to dominate world production, making up  70 percent of  worldwide photovoltaic shipments in 2013.   By 2015, this boom,  driven by large private companies in China, had  created three Chinese solar industry billionaires.[1] But […]

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Credit Growth in China: The Beginning of a “Beautiful” Deleveraging?

by | March 6th, 2015 | 01:12 pm

LAST month the People’s Bank of China (PBoC) released data on the stock of credit in the economy. As of the end of 2014, the stock of total social financing (TSF) was RMB123 trillion, 193% of GDP. This shows that credit growth is still outpacing output by 6 percentage points. The question on many analysts’ […]

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As China’s Capital Outflow Quickens, Will the RMB Depreciate?

by | March 2nd, 2015 | 09:10 am

China’s State Administration of Foreign Exchange (SAFE) released Q4 2014 preliminary balance of payments (BOP) data in early February. While China still maintained an overall balance-of-payments surplus last year, the surplus dropped sharply to $117.8 billion, less than one third of the 2013 level. Most significantly, China registered a $91 billion capital and financial account […]

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China Chart of the Week: Anticorruption in China

by | February 27th, 2015 | 06:02 pm

Earlier this week, the Central Commission for Discipline (中共中央纪律检查委员会) released data on the number of investigations and punishments carried out in January 2015. The headline is striking: the number of investigations declined by over 60% from December 2014 and is 62% lower than the monthly average of 2014. The decline is due to a change […]

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Chart of the Week: Australia, New Zealand, and the Chinese Dairy Market

by | February 12th, 2015 | 11:02 am

Last November, China and Australia announced China-Australia Free Trade Agreement, under negotiation since 2005, will be signed in 2015.  As we previously wrote about here, one important clause in this FTA stipulates China will eliminate most tariffs on Australian dairy products.  In 2008, China and New Zealand signed a similar FTA, opening up the Chinese market […]

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China’s Current Account in 2014

by | February 8th, 2015 | 08:32 am

China’s current account surplus as a percent of GDP remained steady in 2014 at just over 2 percent (China’s GDP in 2014 was $10.3 trillion at the market exchange rate).  This is in line with what international observers feel is acceptable bounds, less than 3 percent of GDP.  Its trade surplus rose slightly to 2.7 […]

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Apple and Xiaomi Take on China

by | February 3rd, 2015 | 01:32 pm

As we’ve mentioned in previous posts, it isn’t always easy for US companies, particularly tech companies, to break into the Chinese market.  However, in revealing its fourth quarter sales numbers, Apple has successfully become the largest smartphone maker in terms of units shipped within China.  Over the past 10 years, Apple’s revenue in the Asia […]

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China Chart of the Week: The IMF’s Falling Forecast for China

by | February 2nd, 2015 | 02:28 pm

In April 2011, the IMF forecast the Chinese economy would grow at a yearly rate of 9.46% in 2015. That projection has now been cut by nearly one third (2.7 percentage points), with January’s forecast for this year at 6.8%. The chart below shows that growth forecasts for both 2015 and 2016 have been consistently revised […]

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