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China’s banks urged to switch away from SWIFT as US sanctions over Hong Kong national security law loom

8 days ago

[unable to retrieve full-text content]China should prepare for potential sanctions by the United States by increasing use of its own financial messaging network for cross-border transactions in the mainland, Hong Kong and Macau, according to a report from the investment banking unit of the Bank of China.Chinese state lenders have been revamping contingency plans in anticipation of US legislation that could penalise banks for serving officials who implement the new national security law for Hong Kong.Greater use of the Cross-Border…

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China keeps loan rate steady for third straight month with ‘inaction not surprising’ as economy improves

18 days ago

[unable to retrieve full-text content]China kept its benchmark lending rate steady for the third straight month on Monday, matching market expectations, amid signs that the world’s second-largest economy is recovering from the shock coronavirus pandemic.The one-year loan prime rate (LPR) was kept unchanged at 3.85 per cent, while the five-year LPR remained at 4.65 per cent.Most new and outstanding loans are based on the LPR, while the five-year rate influences the pricing of mortgages.Thirty-four out of 36 participants in a Reuters…

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China loans hits record US$1.73 trillion in first half of 2020 after strong June as coronavirus recovery continues

27 days ago

[unable to retrieve full-text content]New bank lending in China rose 22.3 per cent in June from May as authorities continued to boost credit and ease policy to get the world’s second-largest economy humming again after a sharp coronavirus-induced contraction.Chinese banks extended 1.81 trillion yuan (US$258 billion) in new yuan loans in June, up from 1.48 trillion yuan in May and slightly exceeding analysts’ expectations, according to data released by the People’s Bank of China (PBOC) on Friday.That pushed bank lending in the first…

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China’s forex reserves rise to US$3.112 trillion in June

July 7, 2020

[unable to retrieve full-text content]China’s foreign exchange reserves rose less than expected in June as the yuan strengthened and global asset prices rebounded amid a recovery in economic sentiment.The country’s foreign exchange reserves – the world’s largest – rose US$10.64 billion in June to US$3.112 trillion, central bank data showed on Tuesday.Economists polled by Reuters had expected the country’s reserves to rise by US$18.31 billion to US$3.120 trillion.Foreign inflows into Chinese stocks and bonds have picked up recently…

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Senator Marco Rubio seeks to ban Chinese firms from US capital markets

July 1, 2020

[unable to retrieve full-text content]A top senator is preparing a bill to ban Chinese companies from US capital markets if they engage in spying, human rights abuse or support China’s military, threatening a financial blow as tensions mount over Covid-19 and Beijing’s crackdown on Hong Kong.Republican Marco Rubio, a prominent China hardliner, said he plans to unveil the legislation in the coming weeks after the US Department of Defence released a list of 20 companies, including telecoms giant Huawei and video surveillance firm…

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World Bank official to join China’s US trade talks team

June 25, 2020

[unable to retrieve full-text content]China is adding a new face to its trade negotiation team by appointing its chief representative at the World Bank to head the Ministry of Finance’s international cooperation department, three people with direct knowledge of the matter said.Yang Yingming, who has been executive director for China at the World Bank in Washington since 2016, returns to the ministry months after Beijing and Washington completed a phase one agreement that brought a truce to their bitter trade war, although bilateral…

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Steven Mnuchin says US-China decoupling will occur if American firms cannot compete fairly

June 23, 2020

[unable to retrieve full-text content]US Treasury Secretary Steven Mnuchin said on Tuesday that a decoupling of the US and Chinese economies will result if American companies are not allowed to compete on a fair and level basis in China’s economy.Speaking at a virtual event sponsored by Bloomberg and Invesco, Mnuchin said he also had “every expectation” that China would live up to the terms of the phase one trade agreement calling for a massive increase in Chinese purchases of US goods, energy and services.“If we can compete with…

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China ‘unsurprisingly’ keeps benchmark loan rate unchanged for second straight month

June 22, 2020

[unable to retrieve full-text content]China left its benchmark lending rate unchanged for the second straight month at its June fixing on Monday, matching market expectations, after the central bank kept borrowing costs on medium-term loans steady last week.The one-year loan prime rate (LPR) remained at 3.85 per cent, while the five-year LPR was also steady at 4.65 per cent.The move in the LPR affects the price lenders charge companies and households for loans, and the five-year rate influences the pricing of mortgages.A Reuters…

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Coronavirus impact: China’s auction of 1 trillion yuan of special treasury bonds to begin this week, sources say

June 15, 2020

[unable to retrieve full-text content]The Chinese government will begin auctions this week of a planned issue of 1 trillion yuan (US$141 billion) of special treasury bonds to help finance recovery from the coronavirus pandemic, sources told Reuters on Monday.Sales will be completed by the end of July, according to the sources, who attended a meeting held by China’s Ministry of Finance, which will issue the bonds.China announced plans in May to sell 1 trillion yuan of special treasury bonds to help fund economic stimulus in the wake…

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Hong Kong security law: US may restrict capital flows through city, Treasury Secretary Steven Mnuchin says

June 12, 2020

[unable to retrieve full-text content]US Treasury Secretary Steven Mnuchin said on Thursday he was working on various capital markets responses to China’s national security law for Hong Kong, including some measures that could restrict capital flows through the city.Mnuchin said his primary focus in the United States’ response to China’s Hong Kong clampdown was through the President’s Working Group on Capital Markets, an inter-agency group of US financial regulators.US President Donald Trump ordered the US Treasury-led group last…

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China’s new bank loans fell in May, but broader credit growth quickened amid policy easing

June 10, 2020

[unable to retrieve full-text content]New bank lending in China fell more than expected in May from the previous month, but broader credit growth quickened as the central bank continues to ease policy to get the economy back on solid footing after the shock from the coronavirus crisis.Banks extended 1.48 trillion yuan (US$209 billion) in new yuan loans in May, down from 1.70 trillion yuan in April and falling short of analyst expectations, according to data released by the People’s Bank of China (PBOC) on Wednesday.Analysts polled…

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China’s May foreign exchange reserves unexpectedly rise to US$3.102 trillion

June 7, 2020

[unable to retrieve full-text content]China’s foreign exchange reserves rose unexpectedly in May even as the yuan weakened on worries over an escalation in tensions between Beijing and Washington.The world’s largest forex reserve rose by US$10.233 billion in the month to US$3.102 trillion, according to figures released by China’s central bank on Sunday.Economists polled by Reuters had expected the reserves to fall by US$10.459 billion in May due to fluctuations in global exchange rates and the prices of foreign bonds that Beijing…

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Volkswagen is in final talks to pay US$491 million for an electric carmaker in Anhui, sealing its biggest acquisition in China

May 27, 2020

[unable to retrieve full-text content]Volkswagen is in final talks to seal its largest investment deals with Chinese electric vehicle (EV) firms, two sources said, as the German carmaker accelerates its push into the world’s largest market for environmentally friendlier cars.The firm is poised to buy 50 per cent of Anhui Jianghuai Automobile Group Holding, the parent of EV partner JAC Motors, for at least 3.5 billion yuan (US$491 million), the people said on condition of anonymity as the matter was private.It is also set to become…

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China’s banks extended 1.7 trillion yuan of new loans in April, beating expectations

May 11, 2020

[unable to retrieve full-text content]New bank lending in China fell less than expected in April from the previous month while growth of broad money supply quickened, as the central bank ramped up policy support for the coronavirus-ravaged economy.Chinese banks extended 1.7 trillion yuan (US$240 billion) in new loans in April, down from 2.85 trillion yuan in March but exceeding expectations, according to data released by the People’s Bank of China (PBOC) on Monday.Analysts polled by Reuters had predicted new yuan loans would fall…

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Coronavirus: China car sales mark first gain in almost two years after restrictions are eased

May 11, 2020

[unable to retrieve full-text content]China’s monthly car sales rose for the first time in almost two years in April, industry data showed, as more customers visited showrooms after the economy began to open up and authorities loosened coronavirus-related travel restrictions.Sales in April hit 2.07 million units in the world’s biggest car market, up 4.4 per cent from a year earlier, according to data from the China Association of Automobile Manufacturers, the country’s largest industry association.This follows a 43 per cent drop in…

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China car sales set to rise 0.9 per cent in April, ending almost two years of declines, industry body predicts

May 7, 2020

[unable to retrieve full-text content]Car sales in China likely rose in April from a year earlier, its top industry body said on Thursday, ending almost two years of declines and signalling that the world’s biggest market is recovering from the coronavirus shock.April’s sales of 2 million units likely pushed sales up 0.9 per cent from a year earlier, and 39.8 per cent from March, the China Association of Automobile Manufacturers (CAAM) said in a post on its official WeChat account.It added its forecast was based on sales data it…

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More than 120 Chinese listed companies apply for regulatory approval to delay publishing their annual reports

May 1, 2020

[unable to retrieve full-text content]The number of mainland China-listed firms to delay filing annual reports past the regulatory deadline of April 30 has surged to 129, from four the year before, an indicator of the level of disruption that will linger after coronavirus lockdowns end.The first three months of the year are a busy time for firms with year-end accounts which have to be filed by April-end, a regulatory redline beyond which companies risk fines and stock suspensions.But a widespread lockdown for all of February…

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China’s fiscal first quarter revenue declines over 14 per cent, weighed down by coronavirus, tax relief

April 20, 2020

[unable to retrieve full-text content]China’s fiscal first quarter revenue fell 14.3 per cent from a year earlier, the country’s finance ministry said on Monday.The decline to 4.598 trillion yuan (US$650 billion) was attributed to the coronavirus outbreak and tax relief offered.Fiscal expenditures for the January-March period fell 5.7 per cent from a year earlier to 5.528 trillion yuan, the ministry said.Last year, China’s fiscal revenues grew at the slowest pace since 1987 after Beijing’s tax cuts in response to the country’s…

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Coronavirus: China trade war tariffs stay, even as US suspends some duties to aid importers

April 20, 2020

The Trump administration said on Sunday that it would allow importers hit by the national health crisis to defer any tariff payments they owe the government for three months.The measure aims to help businesses hit by the coronavirus pandemic, which has put millions of Americans out of work and is widely seen pushing the economy into a deep recession.US President Donald Trump signed an executive order allowing deferred payments to “protect American jobs and help these businesses get through this time,” US Treasury Secretary Steven Mnuchin said in a statement.Still, the tariff deferment policy does not extend to importers of goods caught up in several trade conflicts, the Treasury Department said.Advertisement

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Coronavirus: China’s benchmark loan rate cut another sign authorities are ‘serious about monetary easing’

April 20, 2020

[unable to retrieve full-text content]China cut its benchmark lending rate as expected on Monday to reduce borrowing costs for companies and prop up the coronavirus-hit economy, after it contracted for the first time in decades.The one-year loan prime rate (LPR) was lowered by 20 basis points to 3.85 per cent from 4.05 per cent previously, while the five-year LPR was cut by 10 basis points to 4.65 per cent from 4.75 per cent.The move was the second cut to the lending benchmark rate this year, and the latest reduction in one of…

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Coronavirus: foreign investment into China down almost 11 per cent in first quarter of 2020

April 15, 2020

[unable to retrieve full-text content]Foreign direct investment into China fell 10.8 per cent in the first quarter to 216.19 billion yuan (US$30.7 billion) compared with a year earlier, dragged down by the coronavirus pandemic, the commerce ministry said on Wednesday.That compared with an 8.6 per cent decline in the first two months of the year.In March alone, foreign direct investment dropped 14.1 per cent from a year earlier.Sign up now and get a 10% discount (original price US$400) off the China AI Report 2020 by SCMP Research…

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Coronavirus: China cuts MLF borrowing costs to record low, stepping up pandemic battle

April 15, 2020

[unable to retrieve full-text content]China’s central bank on Wednesday cut the interest rate on its medium-term funding for financial institutions to the lowest on record, as policymakers stepped up their efforts to combat the economic fallout from the coronavirus health crisis.The move should pave the way for a similar reduction to the country’s benchmark loan prime rate (LPR), which will be announced on Monday, to lower financing costs for companies hit by the pandemic.The People’s Bank of China (PBOC) said it was lowering the…

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Coronavirus: China’s March car sales down over 40 per cent, but Tesla had record month

April 9, 2020

China’s March car sales fell 40.8 per cent from a year earlier to 1.08 million units, the China Passenger Car Association said on Thursday, as efforts to curb the coronavirus pandemic in the country weakened economic activity.The association, however, said that overall passenger car sales volume in April would be much higher than in March.Car sales in China plunged 79 per cent in February, the biggest ever monthly decline, as demand was hit by the coronavirus outbreak, the China Association of Automobile Manufacturers (CAAM) said.Tesla, though, sold 10,160 vehicles in China in March, its highest ever monthly sales in the world’s largest car market, the China Passenger Car Association (CPCA) also said on Thursday.
03571EC5-13F4-4283-B996-99444BE88411Tesla, which aims to produce 150,000

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Coronavirus: G20 to develop plan to deal with pandemic as global recession looms

March 24, 2020

[unable to retrieve full-text content]Finance ministers and central bankers from the world’s 20 largest economies agreed on Monday to develop an “action plan” to respond to a coronavirus pandemic that the International Monetary Fund now expects to trigger a global recession, but they offered no specifics.The Group of 20 (G20) secretariat issued the statement after the finance officials met by video conference for nearly two hours, amid growing criticism that the world’s “fire station” has been slow to respond to the worsening…

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China’s pork imports surged 158 per cent in January, February

March 24, 2020

[unable to retrieve full-text content]China’s pork imports in the first two months of 2020 surged 158 per cent from a year earlier to 560,000 tonnes, customs data showed on Tuesday, as the world’s top consumer brought in large supplies ahead of the Lunar New Year holiday in January.The jump came even after the clearing of frozen goods at ports slowed sharply in February because of the coronavirus epidemic that has killed more than 3,000 people in China and kept millions more at home in quarantine.China is facing a severe shortage…

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Coronavirus: G20 to skip statement after Monday’s call, source says, underscoring challenges

March 23, 2020

[unable to retrieve full-text content]G20 finance leaders will not issue a statement after Monday’s teleconference, a source told Reuters, underscoring the challenge they face in garnering a consensus on how to deal with the rising economic risk from the coronavirus outbreak.The talks come as the Group of 20 (G20) faces pressure to take coordinated action against a pandemic that has jolted markets and stoked fears of a global recession.At the teleconference, the G20 finance leaders are expected to prepare for a summit complicated…

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China keeps benchmark loan rate unchanged despite coronavirus

March 20, 2020

[unable to retrieve full-text content]China kept its benchmark lending rate steady on Friday, defying expectations for a reduction to ease borrowing costs in an economy jolted by widespread disruptions to businesses from the coronavirus pandemic.The one-year loan prime rate (LPR) was left unchanged at 4.05 per cent from the previous monthly fixing, while the five-year LPR remained at 4.75 per cent.Analysts said the unchanged rate suggests policymakers may think recent measures are enough to help the economy in the immediate term,…

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Coronavirus: China’s car manufacturers call for government help as sales post biggest monthly drop

March 12, 2020

[unable to retrieve full-text content]Car manufacturers in China are calling on the government to help after industry-wide sales plunged 79 per cent in February to mark their biggest ever monthly decline, with demand pummelled by the coronavirus outbreak.Their wish list includes cuts to the purchase tax on smaller vehicles, measures to support sales in rural markets and an easing of car emission requirements, the China Association of Automobile Manufacturers (CAAM) said.February sales in the world’s biggest car market tumbled to…

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China’s loans slumped in February due to coronavirus, Lunar New Year

March 11, 2020

[unable to retrieve full-text content]New bank lending in China fell more than expected in February from a record in January, but the drop was likely due to seasonal factors as policymakers stepped up support for the economy jolted by a coronavirus outbreak.Chinese banks extended 905.7 billion yuan (US$130 billion) in new yuan loans in February, down from a record 3.34 trillion yuan (US$480 billion) in January and missing analyst expectations, according to data released by the People’s Bank of China (PBOC) on Wednesday.Analysts…

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Cuts to passenger flights send air freight rates soaring as manufacturing resumes in China

March 11, 2020

[unable to retrieve full-text content]Air freight rates are skyrocketing after the grounding of many passenger flights in Asia has left shippers scrambling to book limited spots on cargo planes as Chinese industrial production restarts, according to industry insiders.About half of the air cargo carried worldwide normally flies in the belly of passenger jets rather than in dedicated freighters. But deep flight cuts in response to the coronavirus outbreak have made the market more dependent on freight haulers.Freight forwarder…

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