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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

China Chart of the Week: Inequality Continues A Steady Decline

by | January 30th, 2015 | 09:00 am

Earlier this month China released its preliminary 2014 economic indicators including the latest reading on China’s gini coefficient as a measure of income inequality. It showed inequality has been on a steady decline now for six consecutive years. After reaching a peak of 0.49 in 2008 China’s gini coefficient is now only 0.47. However, before […]

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China Rebalancing Update – Q4 2014

by | January 29th, 2015 | 08:00 am

With all the relevant economic data out, we can now update our rebalancing indicators for the fourth quarter of 2014: Disposable Income Growing Faster than Per Capita GDP We have revised our benchmark to take population growth into account with real per capita GDP growth rather than just looking at real GDP growth. We have […]

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China Chart of the Week: Chinese Firms Top Forbes 2000

by | January 28th, 2015 | 02:41 pm

The Forbes Global 2000 companies list, which ranks the top 2000 largest public companies annually, was notable in 2014 because for the first time, three Chinese banks (ICBC, China Construction Bank, and Agribultural Bank of China) topped the list.  In 2006, there were no Chinese firms in even the top 50 companies.  Between 2006 and […]

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Deleveraging the State in China

by | January 26th, 2015 | 03:40 pm

Corporate leverage has grown rapidly in recent years in the state sector. If the government remains committed to its policy of moderating the growth of credit, as economic growth slows, this could lead to the partial privatization of state assets. Corporate deleveraging is not without precedent in China. In the 1990s China’s industrial sector was […]

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China Chart of the Week: China’s Real Effective FX Appreciation in Perspective

by | January 23rd, 2015 | 05:12 pm

The renminbi depreciated by 2.5% against the US dollar in 2014, reversing a multi-year trend of appreciation. This depreciation has led some to question whether China has abandoned their policy of allowing the RMB to appreciate against the dollar. As we pointed out in our recent post reviewing the government’s foreign exchange and capital account […]

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China Chart of the Week: Deflationary Pressure Gathers Steam

by | January 15th, 2015 | 02:06 pm

China’s National Bureau of Statistics recently released data on the prices of 50 different industrial inputs.  The tracked products include: copper, chemicals, oil, coal, rice, and wood.  This data show the average price of these products over 10 days and compares them with average price of the previous 10 days.  And over the past 6 […]

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2014 Year-end Review of Exchange Rate and Capital Account Reforms

by | January 9th, 2015 | 12:52 pm

Key Takeaways from 2014 Several new policy changes were implemented including a widening of the currency trading band, the Shanghai-Hong Kong equity connect, and a loosening of controls on FX management for banks Increase in in/out bound direct investment quotas and the announcement of an individual foreign investment scheme A marked slow-down in reserve accumulation […]

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China Chart of the Week: Census Raises GDP

by | December 24th, 2014 | 05:40 pm

Last week China released the preliminary results of its third economic census and its impact on national economic statistics. The headline number was an increase for 2013 GDP level of 3.4% (RMB 1.9tr, USD 308bn), driven primarily by an upward revision and re-categorization in tertiary industries. A USD 308 billion revision, roughly equivalent to Malaysia and Singapore’s 2013 GDP, […]

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China Rebalancing Update – Q3 2014

by | December 17th, 2014 | 11:18 am

With all the relevant economic data out, we can now update our rebalancing indicators for the third quarter of 2014: 1. Urban Disposable Income Growing Faster than GDP The gap between GDP growth and urban disposable income growth expanded slightly in the third quarter of 2014. In real terms, GDP growth was 50 basis points […]

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Monday Readings about the Chinese Economy

by | December 15th, 2014 | 05:58 pm

With so many articles about China that came out on Friday and over the weekend, we collected a few that you will not want to miss: Economics Yesterday’s Lima agreement was inspired by the Obama-Xi deal from last month. We expressed hope about that deal in November. The New York Times reported: “the catalyst for the […]

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