China's post-pandemic tourism recovery is showing signs of slowing down. As travelers become more cautious with spending, hotels across the country are slashing prices to attract customers. While tourism demand remains strong, falling spending levels are triggering intense competition across the hospitality sector, raising fresh concerns about China's broader economic outlook.

China's travel boom hits reality

China's economy is increasingly becoming a tale of two contrasting realities. While provinces driven by artificial intelligence, semiconductors, advanced manufacturing, and exports are experiencing rapid economic growth, regions dependent on tourism, real estate, and traditional industries are struggling to keep pace.

The latest provincial economic data highlights a widening K-shaped economic divide, with technology hubs such as Zhejiang, home to Alibaba, DeepSeek, and Unitree Robotics, outperforming the national average. Other manufacturing powerhouses including Shanghai, Anhui, and Shandong have also recorded strong growth, fueled by rising global demand for high-tech products.

China's K-Shaped Economy Deepens as AI Boom Widens Regional Gap

China's appetite for gold is showing no signs of slowing down. The world's largest bullion market imported around 173 tonnes of gold in June, marking the highest monthly import level since March 2024 and extending gains for the third consecutive month.

The surge comes after international gold prices corrected sharply from their early-2026 highs, encouraging investors to buy the dip. A stronger Chinese yuan also made overseas gold purchases more affordable, while commercial banks accelerated imports before a new licensing regime took effect.

China's Gold imports hit highest level since 2024 | Gold demand surges as prices fall

The United States is preparing a fresh wave of tariffs on dozens of trading partners, as President Donald Trump doubles down on using trade penalties as a negotiating tool. The new duties could affect countries including China, India, Japan, Canada, Mexico, the European Union and others, with Washington accusing some nations of failing to address forced labour concerns.

Donald Trump expands global Trade Tariff Push | World Business Watch | Wion 

Asia's property market is sending mixed signals. While countries like India and Japan continue to post record demand and rising investments,markets such as Hong Kong and Mainland China are still grappling with weaker fundamentals. But beneath those headline numbers lies a deeper story -one of widening gaps between cities, sectors and even buildings. Here's a closer look.

Asia's property boom hides a growing divide | World Business Watch | Wion News 

 China has just posted its highest-ever oil and gas production. But even as Beijing celebrates record output, it is warning that the country's energy future is becoming far more difficult. Depleting oilfields, rising extraction costs and growing geopolitical risks are forcing China to rethink how it secures its energy supplies.

China's Energy Warning After Record Output | World Business Watch | Wion News 

China's proposed export restrictions on rare earth minerals could put $6.5 trillion worth of global downstream production at risk if fully implemented. This is according to the International Energy Agency's latest global critical minerals outlook.

IEA warns: China's export controls put $6.5 trillion at risk | World Business Watch  

In today's Newsroom roundup, global markets gained after softer US inflation eased concerns over an immediate Federal Reserve rate hike, while China's slowing economy and rising oil prices kept investors cautious. In technology, Meta faces a lawsuit from former employees over alleged AI-assisted layoffs targeting workers with disabilities and those on medical leave. Switzerland has also launched an investigation into Google over changes to Android's default search options, while reports claim Iran exploited telecom vulnerabilities to track US military personnel. In sports, Spain defeated France 2-0 to reach the FIFA World Cup Final, while Argentina prepare to face England in the second semi-final. In cricket, India ended their winless streak with a six-wicket victory over England in the first ODI.

Global markets rally | Meta sued over AI layoffs | Iran tracked US troops? | India beat England

Top Speed News:
A. West Asia & US-Iran Conflict

US continues fresh airstrikes on Iran for the fourth consecutive day.
Trump warns Iran of wider strikes on power plants and bridges.
Iran claims drone attacks on US bases across the Gulf.
Bahrain says Iranian attacks targeted US Fifth Fleet facilities.
Strait of Hormuz crisis fuels global oil market fears.

B. Russia-Ukraine War

Russia attacks merchant ships in Ukraine's Black Sea corridor.

C. FIFA World Cup 2026

Spain defeat France 2-0 to reach the FIFA World Cup Final.
England face Argentina for the final spot in the World Cup.

D. United States

US House passes bill to make Daylight Saving Time permanent.
San Francisco boat fire leaves one dead and two missing.

E. Latin America

Cuba suffers a third nationwide blackout in less than 10 days.
Colombia rescues 39 hostages from ELN rebels.
Spanish man arrested with cocaine at a Colombia airport.

F. Health

WHO launches the first Ebola antiviral exposure trial in DR Congo.

G. Technology

UK study links social media limits to better teen mental health.
Switzerland probes Google over Android search engine changes.
White House launches AI cybersecurity coordination initiative.

H. Business & Economy

Asian markets rise as US inflation eases.

Trump expands Iran strikes | Hormuz crisis | Bahrain attack | Russia-Ukraine war | World Cup final

<p>Amid global conflicts and turbulence, China quietly managed to achieve two records in 2025: a historic trade surplus nearing $1.2 trillion, and improved status as the world’s top automaker by both production and sales volume. The overall trade volume reached nearly $6.48–6.51 trillion, aided by manufacturing strength and strategic diversification of markets. These economic milestones indicate that China continues to dominate global production, even as it adapts its exports to changing market conditions caused by conflicts and trade wars. These feats were achieved in a tense environment that also involves its rivalries with the West over Taiwan and the South China Sea. Here is how China fared in 2025, based on the latest official data.</p><h2>China posts largest annual trade surplus in its history</h2><p>The Asian giant showed resilience in manufacturing and exports amid various challenges, including the tariff war unleashed by US President Donald Trump. It posted a record trade surplus of $1.189 trillion for the full year 2025, showed data from the country’s General Administration of Customs on Wednesday (Jan 14). This is the first time that the annual surplus exceeded $1 trillion, and breaks the previous record of around $992–993 billion in 2024 by about 20 per cent. China’s exports totalled around $3.77 trillion, up 5.5 per cent on year, while imports remained relatively flat at around $2.58 trillion.</p><p>The surplus had crossed the $1 trillion mark by November 2025 already, and widened further in December, with the final month of 2025 alone showing a surplus of $114.14 billion. December saw exports grow 6.6 per cent year on year, while imports were also up 5.7 per cent year on year.</p><p>Also read: <a href="https://www.wionews.com/india-news/china-lauds-india-for-surpassing-japan-becoming-world-s-fourth-largest-economy-1767177928026">China lauds India for surpassing Japan, becoming world's fourth largest economy</a></p><h2>Chinese exporters pivoted aggressively to non-US markets</h2><p>Trade ressures mainly from the US led Chinese exporters to aggressively seek out new markets in the European Union, ASEAN countries in Southeast Asia, Africa, and Latin America. A surge in exports to these regions helped offset declines in shipments to the US. China managed to post monthly trade surpluses exceeding $100 billion at least seven times in 2025, compared to just once in 2024.&nbsp;</p><p><a href="https://www.wionews.com/videos/byd-overtakes-tesla-as-the-top-ev-maker-in-2025-1767417674001/embed">https://www.wionews.com/videos/byd-overtakes-tesla-as-the-top-ev-maker-in-2025-1767417674001/embed</a></p><h2>China retains and improves top automaker status on the back of electric vehicles</h2><p>This is the 17th straight year in which China ranked top in global auto production and sales. China has held the status of the world’s top auto exporter since 2023. According to China Association of Automobile Manufacturers (CAAM) data, vehicle production in China reached 34.53 million units in 2025, a growth of 10.4 per cent year on year. Vehicle sales hit 34.4 million units, up 9.4 per cent year on year. These figures are also new records.</p><p>Also read: <a href="https://www.wionews.com/business-economy/byd-overtakes-tesla-in-europe-ev-sales-for-the-first-time-1747988684157">BYD overtakes Tesla in Europe EV sales for the first time</a></p><h2>How is China retaining its top automaker position?</h2><p>The bulk of the growth came from new energy vehicles (NEVs), which include electric vehicles and plug-in hybrids. More than 16 million such units were manufactured and sold in 2025, accounting for more than 50 per cent of the total market. Projections by outlets such as Nikkei Asia showed that Chinese vehicle brands like BYD overtook Japanese rivals in global sales for the first time in 2025, selling around 27 million units worldwide, a 17 per cent annual growth, compared with Japan’s 25 million.</p><p>Chinese vehicles, particularly EVs, were competitively priced and marketed abroad aggressively.&nbsp;</p><p>BYD overtook Tesla as the world’s largest seller of battery-electric vehicles (BEVs), selling more than 2.25 million units in 2025, an annual growth of nearly 28 per cent. Tesla, meanwhile, sold around 1.64 million units.</p>

China has made history with a record $1.2 trillion trade surplus in 2025. It also retained and improved its position as the world’s top automaker. Both these feats were achieved amid headwinds of tariffs and trade wars with the US. Just how did China manage this?

Amid global conflicts and turbulence, China quietly managed to achieve two records in 2025: a historic trade surplus nearing $1.2 trillion, and improved status as the world’s top automaker by both production and sales volume. The overall trade volume reached nearly $6.48–6.51 trillion, aided by manufacturing strength and strategic diversification of markets. These economic milestones indicate that China continues to dominate global production, even as it adapts its exports to changing market conditions caused by conflicts and trade wars. These feats were achieved in a tense environment that also involves its rivalries with the West over Taiwan and the South China Sea. Here is how China fared in 2025, based on the latest official data. China posts largest annual trade surplus in its history The Asian giant showed resilience in manufacturing and exports amid various challenges, including the tariff war unleashed by US President Donald Trump. It posted a record trade surplus of $1.189 trillion for the full year 2025, showed data from the country’s General Administration of Customs on Wednesday (Jan 14). This is the first time that the annual surplus exceeded $1 trillion, and breaks the previous record of around $992–993 billion in 2024 by about 20 per cent. China’s exports totalled around $3.77 trillion, up 5.5 per cent on year, while imports remained relatively flat at around $2.58 trillion. The surplus had crossed the $1 trillion mark by November 2025 already, and widened further in December, with the final month of 2025 alone showing a surplus of $114.14 billion. December saw exports grow 6.6 per cent year on year, while imports were also up 5.7 per cent year on year. Also read: China lauds India for surpassing Japan, becoming world's fourth largest economy Chinese exporters pivoted aggressively to non-US markets Trade ressures mainly from the US led Chinese exporters to aggressively seek out new markets in the European Union, ASEAN countries in Southeast Asia, Africa, and Latin America. A surge in exports to these regions helped offset declines in shipments to the US. China managed to post monthly trade surpluses exceeding $100 billion at least seven times in 2025, compared to just once in 2024. https://www.wionews.com/videos/byd-overtakes-tesla-as-the-top-ev-maker-in-2025-1767417674001/embed China retains and improves top automaker status on the back of electric vehicles This is the 17th straight year in which China ranked top in global auto production and sales. China has held the status of the world’s top auto exporter since 2023. According to China Association of Automobile Manufacturers (CAAM) data, vehicle production in China reached 34.53 million units in 2025, a growth of 10.4 per cent year on year. Vehicle sales hit 34.4 million units, up 9.4 per cent year on year. These figures are also new records. Also read: BYD overtakes Tesla in Europe EV sales for the first time How is China retaining its top automaker position? The bulk of the growth came from new energy vehicles (NEVs), which include electric vehicles and plug-in hybrids. More than 16 million such units were manufactured and sold in 2025, accounting for more than 50 per cent of the total market. Projections by outlets such as Nikkei Asia showed that Chinese vehicle brands like BYD overtook Japanese rivals in global sales for the first time in 2025, selling around 27 million units worldwide, a 17 per cent annual growth, compared with Japan’s 25 million. Chinese vehicles, particularly EVs, were competitively priced and marketed abroad aggressively. BYD overtook Tesla as the world’s largest seller of battery-electric vehicles (BEVs), selling more than 2.25 million units in 2025, an annual growth of nearly 28 per cent. Tesla, meanwhile, sold around 1.64 million units.

<p>China has made history with a record $1.2 trillion trade surplus in 2025. It also retained and improved its position as the world’s top automaker. Both these feats were achieved amid headwinds of tariffs and trade wars with the US. Just how did China manage this?<br>&nbsp;</p>

China's economic wins: Largest-ever trade surplus of $1.2 trillion, consolidation of top automaker status

<p>China’s steel and coal production fell in July, weighed down by extreme weather disruptions and Beijing’s renewed push to rein in excess capacity, according to Bloomberg. The slowdown comes as deflationary pressures intensify across the world’s second-largest economy. Official data cited by Bloomberg shows steel production dropped 4 per cent year-on-year to under 80 million tonne, the lowest monthly output in 2024 so far and the third straight monthly decline. Although the fall was less steep than in May and June, reduced supply helped improve profit margins for producers.</p><p>&nbsp;</p><p>Over the first seven months of the year, steel output was down 3.1 per cent compared with 2023, marking the weakest level since 2020. Analysts say the industry is grappling with weaker domestic demand, particularly from the struggling property sector, even as exports have risen to absorb some of the surplus. Bloomberg Intelligence estimates China’s excess steel capacity in 2023 at 142 million tonnes — nearly four times the level recorded in 2020.</p><h2><strong>Coal sector sees rare drop in production</strong></h2><p>Coal output fell 3.8 per cent year-on-year to just over 380 million tonnes in July — the first such decline in more than a year. Despite this, January-to-July production remained at record levels.</p><p>&nbsp;</p><p>Northern China’s coal hubs were hit hard by torrential rains, which forced mines to shut and disrupted transport links. At the same time, government inspections targeted mines exceeding permitted production limits, adding further pressure on supply.</p><p>&nbsp;</p><p>Thermal coal producers have been shielded from deeper cuts due to surging electricity demand amid summer heatwaves, but coking coal miners, critical suppliers to steelmakers face fewer protections as steel demand remains under strain.</p><h2><strong>Policy and environmental pressures ahead</strong></h2><p>As per Bloomberg, Beijing’s pollution controls ahead of next month’s military parade in the capital are expected to further limit steel output, with much of China’s steel capacity located near Beijing.</p><p>&nbsp;</p><p>While steel exports have helped offset weak domestic consumption, rising global protectionism could limit overseas sales in the coming months. With the property market slump stripping away one of the sector’s key demand pillars, the industry faces a challenging road ahead.</p><p>&nbsp;</p><p><i>(With inputs from the agencies)</i></p>

Coal output fell 3.8% due to heavy rains and inspections. Analysts warn of weak domestic demand and rising protectionism affecting future exports as the property market struggles.

China’s steel and coal production fell in July, weighed down by extreme weather disruptions and Beijing’s renewed push to rein in excess capacity, according to Bloomberg. The slowdown comes as deflationary pressures intensify across the world’s second-largest economy. Official data cited by Bloomberg shows steel production dropped 4 per cent year-on-year to under 80 million tonne, the lowest monthly output in 2024 so far and the third straight monthly decline. Although the fall was less steep than in May and June, reduced supply helped improve profit margins for producers. Over the first seven months of the year, steel output was down 3.1 per cent compared with 2023, marking the weakest level since 2020. Analysts say the industry is grappling with weaker domestic demand, particularly from the struggling property sector, even as exports have risen to absorb some of the surplus. Bloomberg Intelligence estimates China’s excess steel capacity in 2023 at 142 million tonnes — nearly four times the level recorded in 2020. Coal sector sees rare drop in production Coal output fell 3.8 per cent year-on-year to just over 380 million tonnes in July — the first such decline in more than a year. Despite this, January-to-July production remained at record levels. Northern China’s coal hubs were hit hard by torrential rains, which forced mines to shut and disrupted transport links. At the same time, government inspections targeted mines exceeding permitted production limits, adding further pressure on supply. Thermal coal producers have been shielded from deeper cuts due to surging electricity demand amid summer heatwaves, but coking coal miners, critical suppliers to steelmakers face fewer protections as steel demand remains under strain. Policy and environmental pressures ahead As per Bloomberg, Beijing’s pollution controls ahead of next month’s military parade in the capital are expected to further limit steel output, with much of China’s steel capacity located near Beijing. While steel exports have helped offset weak domestic consumption, rising global protectionism could limit overseas sales in the coming months. With the property market slump stripping away one of the sector’s key demand pillars, the industry faces a challenging road ahead. (With inputs from the agencies)

<p>In July, China’s steel production declined 4% year-on-year to below 80 million tonnes, the lowest in 2024, amid extreme weather and government capacity control efforts.</p>

China’s steel and coal output falls as supply pressures and bad weather bite

<p>China’s economy showed clear signs of strain in July, with key indicators slowing amid weak domestic consumption, persistent property sector woes, and global trade headwinds. Data from the National Bureau of Statistics (NBS) on August 15 showed industrial output rose 5.7 per cent year-on-year, down from 6.8 per cent in June and marking the slowest pace since November 2024. The reading missed analysts’ forecasts for a 5.9 per cent gain. Retail sales, a key measure of household spending, expanded just 3.7 per cent in July from a year earlier, cooling from June’s 4.8 per cent rise and falling short of a Reuters poll forecast of 4.6 per cent.&nbsp;</p><p>The figure was the weakest since December 2024, underlining consumer caution despite Beijing’s efforts to boost spending through subsidies and trade-in programmes. Fixed-asset investment for January-July grew only 1.6 per cent year-on-year, missing expectations for 2.7 per cent and slowing from 2.8 per cent in the first half of 2025. Property investment slumped 12 per cent in the same period, extending a multi-year downturn in a sector that remains a major driver of household wealth.</p><h2><strong>Policy support fading, risks mounting</strong></h2><p>Economists said the July slowdown was partly expected, as factors that buoyed growth in the first half of 2025—such as front-loaded government stimulus and pre-emptive export shipments during the US-China tariff truce—are now fading. The Politburo has made boosting domestic consumption a priority this year, funnelling hundreds of billions of yuan into appliance trade-in programmes and new service industries. Yet some provinces have already suspended certain subsidies due to depleted funds.&nbsp;</p><p>While total exports surged 7.2 per cent in July, helped by rising shipments to Africa and Europe and a surge in chip sales, weak household spending remains a drag on growth. The urban unemployment rate edged up to 5.2 per cent in July from 5 per cent in June, while the jobless rate for 16-24-year-olds (excluding students) has stayed above 14 per cent for a year, underscoring labour market strains.</p><h2><strong>Trade truce buys time, but core disputes persist</strong></h2><p>On the global front, Beijing and Washington this week extended their tariff pause for another 90 days until mid-November, averting a spike in duties. However, analysts caution that deep disagreements over technology access, critical minerals, and industrial policy remain unresolved. Some analysts said that the big political trade-offs are likely being reserved for a potential summit between US President Donald Trump and Chinese President Xi Jinping later this year.</p><p>A Reuters poll projects China’s GDP growth to slow to 4.5 per cent in the third quarter and 4.0 per cent in the fourth, putting the official 2025 growth target of “around 5 per cent” at risk. Economists warn that without fresh stimulus, the combination of property market weakness, consumer caution, and external shocks could see full-year growth undershoot forecasts, with momentum slipping further into 2026.</p><p>&nbsp;</p><p>(<i>With inputs from agencies</i>)</p>

Data from the National Bureau of Statistics (NBS) on August 15 showed industrial output rose 5.7 per cent year-on-year, down from 6.8 per cent in June and marking the slowest pace since November 2024.

China’s economy showed clear signs of strain in July, with key indicators slowing amid weak domestic consumption, persistent property sector woes, and global trade headwinds. Data from the National Bureau of Statistics (NBS) on August 15 showed industrial output rose 5.7 per cent year-on-year, down from 6.8 per cent in June and marking the slowest pace since November 2024. The reading missed analysts’ forecasts for a 5.9 per cent gain. Retail sales, a key measure of household spending, expanded just 3.7 per cent in July from a year earlier, cooling from June’s 4.8 per cent rise and falling short of a Reuters poll forecast of 4.6 per cent. The figure was the weakest since December 2024, underlining consumer caution despite Beijing’s efforts to boost spending through subsidies and trade-in programmes. Fixed-asset investment for January-July grew only 1.6 per cent year-on-year, missing expectations for 2.7 per cent and slowing from 2.8 per cent in the first half of 2025. Property investment slumped 12 per cent in the same period, extending a multi-year downturn in a sector that remains a major driver of household wealth. Policy support fading, risks mounting Economists said the July slowdown was partly expected, as factors that buoyed growth in the first half of 2025—such as front-loaded government stimulus and pre-emptive export shipments during the US-China tariff truce—are now fading. The Politburo has made boosting domestic consumption a priority this year, funnelling hundreds of billions of yuan into appliance trade-in programmes and new service industries. Yet some provinces have already suspended certain subsidies due to depleted funds. While total exports surged 7.2 per cent in July, helped by rising shipments to Africa and Europe and a surge in chip sales, weak household spending remains a drag on growth. The urban unemployment rate edged up to 5.2 per cent in July from 5 per cent in June, while the jobless rate for 16-24-year-olds (excluding students) has stayed above 14 per cent for a year, underscoring labour market strains. Trade truce buys time, but core disputes persist On the global front, Beijing and Washington this week extended their tariff pause for another 90 days until mid-November, averting a spike in duties. However, analysts caution that deep disagreements over technology access, critical minerals, and industrial policy remain unresolved. Some analysts said that the big political trade-offs are likely being reserved for a potential summit between US President Donald Trump and Chinese President Xi Jinping later this year. A Reuters poll projects China’s GDP growth to slow to 4.5 per cent in the third quarter and 4.0 per cent in the fourth, putting the official 2025 growth target of “around 5 per cent” at risk. Economists warn that without fresh stimulus, the combination of property market weakness, consumer caution, and external shocks could see full-year growth undershoot forecasts, with momentum slipping further into 2026. (With inputs from agencies)

<p>Data from the National Bureau of Statistics (NBS) on August 15 showed industrial output rose 5.7 per cent year-on-year, down from 6.8 per cent in June and marking the slowest pace since November 2024.</p>

China’s economic growth loses steam in July as domestic demand weakens

<p>China’s economy grew faster than expected in the second quarter of 2025, offering a show of resilience in the face of mounting US tariff threats. But despite beating forecasts, the data points to a slowing economy that faces deep-seated challenges, with analysts warning of deflationary pressures and flagging consumer confidence.</p><p>&nbsp;</p><p>According to data released on Tuesday by China’s National Bureau of Statistics and cited by Reuters, gross domestic product expanded by 5.2 per cent year-on-year between April and June. While this was a slowdown from the 5.4 per cent growth seen in the first quarter, it narrowly surpassed the 5.1 per cent median forecast in a Reuters poll.</p><p>&nbsp;</p><p>Economists say the better-than-expected growth offers Beijing a short-term cushion against a more severe slowdown. Zhiwei Zhang, chief economist at Pinpoint Asset Management, told Reuters the second-quarter growth was partly due to the front-loading of exports ahead of looming tariff deadlines. “The above-target growth in Q1 and Q2 give the government room to tolerate some slowdown in the second half of the year,” Zhang added.</p><h2><strong>Quarterly momentum slows, stimulus bets rise</strong></h2><p>On a quarter-on-quarter basis, China’s GDP rose 1.1 per cent in April-June, slowing slightly from a 1.2 per cent expansion in Q1 but ahead of expectations for a 0.9 per cent increase, as per Reuters.</p><p>This solid start to the year has emboldened Beijing to stick with its official full-year growth target of around 5 per cent, though policymakers are preparing contingency plans as risks mount. A high-stakes Politburo meeting scheduled for late July is widely expected to chart the country’s economic policy for the rest of 2025.</p><p>&nbsp;</p><p>In response to slowing momentum and tariff threats from US President Donald Trump, Beijing has already stepped-up policy support. According to Reuters, the government has increased infrastructure spending, expanded consumer subsidies, and the central bank cut interest rates in May while injecting liquidity into the financial system.</p><p>Analysts expect further monetary easing in the coming months. Some even predict an increase in deficit spending if the economy slows sharply in the second half of the year.</p><h2><strong>Structural headwinds persist</strong></h2><p>Despite the headline GDP beat, many analysts see worrying signs beneath the surface. According to Reuters, producer prices fell in June at their fastest pace in nearly two years, underscoring entrenched deflationary pressures in China’s industrial sector.</p><p>&nbsp;</p><p>Zichun Huang, China economist at Capital Economics, argued the GDP data “probably still overstate the strength of growth,” warning that the effect of current fiscal support may soon fade. “With exports set to slow and the tailwind from fiscal support on course to fade, growth is likely to slow further during the second half of this year,” Huang told Reuters.</p><p>&nbsp;</p><p>Indeed, a Reuters poll projects China’s GDP growth to decelerate to 4.5 per cent in the third quarter and 4.0 per cent in the fourth, reflecting deepening challenges from the trade war and domestic weakness. Looking further ahead, the same poll forecasts growth to slip to 4.6 per cent in 2025, below Beijing’s target, and to ease further to 4.2 per cent in 2026.</p><h2><strong>Mixed activity data underscores fragile recovery</strong></h2><p>Official June activity data released on Tuesday painted a mixed picture. As per Reuters, industrial output rose 6.8 per cent year-on-year, accelerating from 5.8 per cent in May and beating forecasts. But retail sales growth lost steam, suggesting that consumer sentiment remains subdued.</p><p>&nbsp;</p><p>Meanwhile, fixed-asset investment grew 2.8 per cent in the first half of 2025 compared to the same period last year, slowing from 3.7 per cent in January-May and missing analysts’ forecast of 3.6 per cent.</p><p>One of the most persistent drags on the economy remains the property sector. Investment in real estate fell 11.2 per cent year-on-year in the first six months, worsening from a 10.7 per cent decline in January-May. Separate data also showed new home prices in June fell at their fastest monthly pace in eight months, highlighting the difficulty Beijing faces in reviving demand despite multiple rounds of support measures.</p><h2><strong>Trade truce offers only temporary relief</strong></h2><p>Exports showed some resilience in June as factories rushed to ship goods under a fragile trade truce with the United States. But this is seen as temporary, with risks of renewed tariff escalation after an August deadline. As per Reuters, both sides have so far avoided the sharpest trade blows through short-term deals, but tensions remain high, leaving China’s export outlook highly uncertain.</p><p>&nbsp;</p><p>For Beijing, the challenge is to rebalance the economy away from its heavy dependence on investment and exports, and to unlock stronger consumer spending despite households’ caution during an era of slowing growth and geopolitical risk.</p><p><br>&nbsp;</p>

China economy outpaced expectations in Q2 2025, buoyed by export acceleration ahead of US tariffs and increased state support. But with a key Politburo meeting ahead, the real test lies in sustaining momentum through year end.

China’s economy grew faster than expected in the second quarter of 2025, offering a show of resilience in the face of mounting US tariff threats. But despite beating forecasts, the data points to a slowing economy that faces deep-seated challenges, with analysts warning of deflationary pressures and flagging consumer confidence. According to data released on Tuesday by China’s National Bureau of Statistics and cited by Reuters, gross domestic product expanded by 5.2 per cent year-on-year between April and June. While this was a slowdown from the 5.4 per cent growth seen in the first quarter, it narrowly surpassed the 5.1 per cent median forecast in a Reuters poll. Economists say the better-than-expected growth offers Beijing a short-term cushion against a more severe slowdown. Zhiwei Zhang, chief economist at Pinpoint Asset Management, told Reuters the second-quarter growth was partly due to the front-loading of exports ahead of looming tariff deadlines. “The above-target growth in Q1 and Q2 give the government room to tolerate some slowdown in the second half of the year,” Zhang added. Quarterly momentum slows, stimulus bets rise On a quarter-on-quarter basis, China’s GDP rose 1.1 per cent in April-June, slowing slightly from a 1.2 per cent expansion in Q1 but ahead of expectations for a 0.9 per cent increase, as per Reuters. This solid start to the year has emboldened Beijing to stick with its official full-year growth target of around 5 per cent, though policymakers are preparing contingency plans as risks mount. A high-stakes Politburo meeting scheduled for late July is widely expected to chart the country’s economic policy for the rest of 2025. In response to slowing momentum and tariff threats from US President Donald Trump, Beijing has already stepped-up policy support. According to Reuters, the government has increased infrastructure spending, expanded consumer subsidies, and the central bank cut interest rates in May while injecting liquidity into the financial system. Analysts expect further monetary easing in the coming months. Some even predict an increase in deficit spending if the economy slows sharply in the second half of the year. Structural headwinds persist Despite the headline GDP beat, many analysts see worrying signs beneath the surface. According to Reuters, producer prices fell in June at their fastest pace in nearly two years, underscoring entrenched deflationary pressures in China’s industrial sector. Zichun Huang, China economist at Capital Economics, argued the GDP data “probably still overstate the strength of growth,” warning that the effect of current fiscal support may soon fade. “With exports set to slow and the tailwind from fiscal support on course to fade, growth is likely to slow further during the second half of this year,” Huang told Reuters. Indeed, a Reuters poll projects China’s GDP growth to decelerate to 4.5 per cent in the third quarter and 4.0 per cent in the fourth, reflecting deepening challenges from the trade war and domestic weakness. Looking further ahead, the same poll forecasts growth to slip to 4.6 per cent in 2025, below Beijing’s target, and to ease further to 4.2 per cent in 2026. Mixed activity data underscores fragile recovery Official June activity data released on Tuesday painted a mixed picture. As per Reuters, industrial output rose 6.8 per cent year-on-year, accelerating from 5.8 per cent in May and beating forecasts. But retail sales growth lost steam, suggesting that consumer sentiment remains subdued. Meanwhile, fixed-asset investment grew 2.8 per cent in the first half of 2025 compared to the same period last year, slowing from 3.7 per cent in January-May and missing analysts’ forecast of 3.6 per cent. One of the most persistent drags on the economy remains the property sector. Investment in real estate fell 11.2 per cent year-on-year in the first six months, worsening from a 10.7 per cent decline in January-May. Separate data also showed new home prices in June fell at their fastest monthly pace in eight months, highlighting the difficulty Beijing faces in reviving demand despite multiple rounds of support measures. Trade truce offers only temporary relief Exports showed some resilience in June as factories rushed to ship goods under a fragile trade truce with the United States. But this is seen as temporary, with risks of renewed tariff escalation after an August deadline. As per Reuters, both sides have so far avoided the sharpest trade blows through short-term deals, but tensions remain high, leaving China’s export outlook highly uncertain. For Beijing, the challenge is to rebalance the economy away from its heavy dependence on investment and exports, and to unlock stronger consumer spending despite households’ caution during an era of slowing growth and geopolitical risk.

<p>China’s Q2 GDP growth of 5.2% reflects short-term resilience driven by front-loaded exports and stimulus, as Beijing braces for Trump’s looming tariff deadline.</p>

China’s Q2 GDP grows 5.2%, beating forecast even as Trump’s tariff risks rise

<p>China’s manufacturing sector is poised to contract for the second month in a row in May, signalling fresh strain on the country’s export-heavy economy as it faces simultaneous trade flare-ups with the United States and the European Union, highlights a Reuters poll.<br>&nbsp;</p><p>According to a Reuters poll of 21 economists, the official Purchasing Managers’ Index (PMI), scheduled for release on Saturday (June 1), is expected to register at 49.5, slightly higher than April’s 49.0, but still below the 50-point threshold that separates expansion from contraction.&nbsp;</p><p>&nbsp;</p><p>The latest data reflects a broader slowdown across China’s $19 trillion economy, which is contending with weakening domestic demand, deflation, and a growing property crisis, even as policymakers race to stabilise growth through stimulus.</p><h2><strong>China is now fighting a trade war on two fronts</strong></h2><p>The May factory slump comes at a time when China is navigating major trade tensions with both Washington and Brussels.</p><p>&nbsp;</p><p>In the US, President Donald Trump has escalated economic hostilities by slapping 145 per cent tariffs on a wide range of Chinese imports — part of his broader push to decouple from China.&nbsp;<br>&nbsp;</p><p>Although a temporary 90-day tariff truce was reached, with duties lowered to 30 per cent, negotiations remain deadlocked and the core issues unresolved.</p><p>&nbsp;</p><p>Simultaneously, the European Union has reportedly launched anti-dumping investigations targeting Chinese tyres and electric vehicles.&nbsp;<br>&nbsp;</p><p>China has reportedly retaliated with probes into European brandy and dairy products, fuelling fears of a full-fledged trade confrontation with the bloc, as per Reuters.&nbsp;</p><p>&nbsp;</p><p>This dual-front pressure is reportedly placing immense strain on China’s industrial backbone, which has traditionally relied on open global markets to power growth.</p><h2><strong>Domestic challenges are compounding the crisis</strong></h2><p>According to Reuters, China’s internal economic environment offers little relief. Despite a stronger-than-expected GDP performance in Q1 2025, deflation remains entrenched.&nbsp;</p><p>&nbsp;</p><p>The country’s producer price index dropped 2.7 per cent year-on-year in April, extending its contraction for a third consecutive month.&nbsp;</p><p>&nbsp;</p><p>Reuters poll highlights that real incomes have stagnated, and consumer spending has yet to rebound convincingly after the pandemic. Meanwhile, the long-running property sector slump continues to drag on overall sentiment and private investment.<br>&nbsp;</p><p>Even though industrial profits showed some signs of improvement, they remain concentrated among a handful of state-backed firms, leaving smaller manufacturers especially exposed to the current downturn, as per Reuters&nbsp;</p><h2><strong>Beijing is expected to roll out more stimulus</strong></h2><p>To counteract the external and internal economic drag, China’s government is reportedly expected to announce further fiscal and monetary stimulus measures. These could reportedly include additional interest rate cuts, tax incentives, infrastructure spending, and targeted credit for small and medium-sized firms.<br>&nbsp;</p><p>The PMI numbers to be released on June 1 will be followed by the Caixin private sector PMI on June 3, which focuses more on smaller, export-oriented companies. Analysts predict a modest improvement in the Caixin reading, up to 50.6 from 50.4, suggesting fragile but ongoing momentum.</p><h2><strong>The road ahead is uncertain</strong></h2><p>As the world’s second-largest economy contends with deepening trade hostilities and an uneven post-pandemic recovery, the question now is whether Beijing can successfully pivot from an export-driven model to a more resilient, demand-led economy.</p><p>&nbsp;</p><p>The coming weeks, with trade talks in flux, tariff deadlines looming, and critical economic data releases will be crucial in shaping China’s path through a turbulent global landscape.</p>

Business & Economy: This comes amid China is grappling with major trade tensions with the US and the EU.

China’s manufacturing sector is poised to contract for the second month in a row in May, signalling fresh strain on the country’s export-heavy economy as it faces simultaneous trade flare-ups with the United States and the European Union, highlights a Reuters poll. According to a Reuters poll of 21 economists, the official Purchasing Managers’ Index (PMI), scheduled for release on Saturday (June 1), is expected to register at 49.5, slightly higher than April’s 49.0, but still below the 50-point threshold that separates expansion from contraction. The latest data reflects a broader slowdown across China’s $19 trillion economy, which is contending with weakening domestic demand, deflation, and a growing property crisis, even as policymakers race to stabilise growth through stimulus. China is now fighting a trade war on two fronts The May factory slump comes at a time when China is navigating major trade tensions with both Washington and Brussels. In the US, President Donald Trump has escalated economic hostilities by slapping 145 per cent tariffs on a wide range of Chinese imports — part of his broader push to decouple from China. Although a temporary 90-day tariff truce was reached, with duties lowered to 30 per cent, negotiations remain deadlocked and the core issues unresolved. Simultaneously, the European Union has reportedly launched anti-dumping investigations targeting Chinese tyres and electric vehicles. China has reportedly retaliated with probes into European brandy and dairy products, fuelling fears of a full-fledged trade confrontation with the bloc, as per Reuters. This dual-front pressure is reportedly placing immense strain on China’s industrial backbone, which has traditionally relied on open global markets to power growth. Domestic challenges are compounding the crisis According to Reuters, China’s internal economic environment offers little relief. Despite a stronger-than-expected GDP performance in Q1 2025, deflation remains entrenched. The country’s producer price index dropped 2.7 per cent year-on-year in April, extending its contraction for a third consecutive month. Reuters poll highlights that real incomes have stagnated, and consumer spending has yet to rebound convincingly after the pandemic. Meanwhile, the long-running property sector slump continues to drag on overall sentiment and private investment. Even though industrial profits showed some signs of improvement, they remain concentrated among a handful of state-backed firms, leaving smaller manufacturers especially exposed to the current downturn, as per Reuters Beijing is expected to roll out more stimulus To counteract the external and internal economic drag, China’s government is reportedly expected to announce further fiscal and monetary stimulus measures. These could reportedly include additional interest rate cuts, tax incentives, infrastructure spending, and targeted credit for small and medium-sized firms. The PMI numbers to be released on June 1 will be followed by the Caixin private sector PMI on June 3, which focuses more on smaller, export-oriented companies. Analysts predict a modest improvement in the Caixin reading, up to 50.6 from 50.4, suggesting fragile but ongoing momentum. The road ahead is uncertain As the world’s second-largest economy contends with deepening trade hostilities and an uneven post-pandemic recovery, the question now is whether Beijing can successfully pivot from an export-driven model to a more resilient, demand-led economy. The coming weeks, with trade talks in flux, tariff deadlines looming, and critical economic data releases will be crucial in shaping China’s path through a turbulent global landscape.

<p>China's manufacturing sector is expected to contract for the second consecutive month in May, putting strain on the country's export-heavy economy, highlights a Reuters poll.&nbsp;</p>

China’s May factory slowdown likely to deepens as trade tensions with US and EU escalate

<p>China is reportedly preparing a new high-tech industrial policy to follow up on its ambitious “Made in China 2025” strategy.&nbsp;</p><p>This signals the Xi Jinping government's intention to maintain a strong manufacturing base even as the United States ramps up tariffs and calls for economic rebalancing.</p><h2><strong>A modernised version of ‘Made in China’</strong></h2><p>According to a report by Bloomberg, Beijing is working on a successor to its 2015 “Made in China 2025” industrial plan. While the original initiative sparked a backlash from Western nations, the updated version is expected to prioritise strategic sectors like semiconductors and chip-making equipment, while potentially avoiding the same label to reduce global scrutiny.</p><p><br>Sources familiar with the matter told Bloomberg that the new strategy could be unveiled either before or after China announces its 15th Five-Year Plan in March 2026. The manufacturing focus will aim to stabilise the sector’s contribution to GDP and secure China’s position as a global tech powerhouse.</p><h2><strong>US-China tariff tension</strong></h2><p>This development comes at a time of rising trade tensions, with President Donald Trump’s administration pursuing what it calls “strategic decoupling” from China. In April, the US imposed fresh tariffs on Chinese electric vehicles, solar panels, and semiconductors, briefly raising some rates as high as 145 per cent.</p><p>A subsequent agreement in Geneva reduced the average tariff to around 40 per cent, but the pressure on China remains intense.</p><p>&nbsp;</p><p>The US says it wants China to transition from an export-led growth model to one driven by domestic consumption.</p><p>However, Chinese policymakers have resisted external calls to reduce industrial subsidies and market intervention, insisting that manufacturing remains key to national security and job creation.</p><p>&nbsp;</p><p>While the US argues that China needs to raise household consumption levels, Beijing is treading carefully. According to Bloomberg report, officials involved in drafting the upcoming Five-Year Plan are hesitant to include a numerical consumption target. The concern: China lacks the policy tools to boost spending significantly and sustainably.</p><p>&nbsp;</p><p>As it stands, household consumption accounts for only about 40 per cent of China’s GDP—well below the 50 to 70 per cent typical of more developed economies. By contrast, investment (largely in infrastructure and manufacturing) still comprises another 40 per cent, reflecting China’s unique growth model.</p><h2><strong>Manufacturing remains the backbone&nbsp;of China</strong></h2><p><br>During a visit to a ball-bearing factory in Henan on 19 May, President Xi Jinping reaffirmed China’s commitment to strengthening its manufacturing base. “We must keep strengthening the manufacturing sector, adhere to the principles of self-reliance and self-improvement, and master key core technologies,” Xi said, as quoted by Xinhua.</p><p><br>This view has underpinned a decade-long push to achieve dominance in critical industries. The “Made in China 2025” plan targeted ten key sectors—from robotics and electric vehicles to aerospace and biomedicine. Bloomberg Intelligence research shows that China has already attained global leadership in five of those sectors and is catching up fast in seven others.</p><h2><strong>What’s Xi’s Five-Year Plan?</strong></h2><p>According to the South China Morning Post, the upcoming Five-Year Plan will focus on developing “new productive forces,” including electric vehicles, artificial intelligence, and new energy materials. Policymakers are also aiming to address bottlenecks in China’s supply chains and reduce reliance on foreign technologies.</p><p>&nbsp;</p><p>A report published by a newspaper overseen by the National Development and Reform Commission (NDRC) in March noted that promoting consumption and achieving breakthroughs in core technologies will be central to the plan. Research agencies have been instructed to prioritise semiconductor innovation and energy independence.</p><h2><strong>Global implications</strong></h2><p>China’s evolving industrial policy is likely to deepen the global divide over trade. The Biden administration had previously maintained a wait-and-watch approach, but Trump’s return has reignited tariff threats and supply chain shocks—prompting multinational firms to reassess manufacturing hubs.</p><p>&nbsp;</p><p>“Private investments… whatever interest rate cuts you do, I don’t think will move significantly higher simply because private investments will be determined more by a relatively certain atmosphere,” Indranil Pan, chief economist at Yes Bank, told Reuters.</p><p>&nbsp;</p><p>Meanwhile, Treasury Secretary Scott Bessent noted that both countries theoretically have complementary goals: “We need more manufacturing, they need more consumption. So there is a chance to rebalance together — we’ll see if that’s possible,” he said in an interview with CNBC on 12 May.</p><p>&nbsp;</p><p>China’s push to revive and upgrade its manufacturing agenda underscores a widening gulf between its long-term strategy and Washington’s expectations. While the US calls for rebalancing, China appears intent on doubling down on industrial strength, even as trade tensions threaten to escalate further.<br>&nbsp;</p><p>As the world’s two largest economies dig into opposing positions, the ripple effects on global trade, technology, and geopolitical alignment are bound to be far-reaching.<br>&nbsp;</p>

Business & Economy: This development comes at a time of rising trade tensions, with President Donald Trump’s administration pursuing what it calls “strategic decoupling” from China. 

China is reportedly preparing a new high-tech industrial policy to follow up on its ambitious “Made in China 2025” strategy. This signals the Xi Jinping government's intention to maintain a strong manufacturing base even as the United States ramps up tariffs and calls for economic rebalancing. A modernised version of ‘Made in China’ According to a report by Bloomberg, Beijing is working on a successor to its 2015 “Made in China 2025” industrial plan. While the original initiative sparked a backlash from Western nations, the updated version is expected to prioritise strategic sectors like semiconductors and chip-making equipment, while potentially avoiding the same label to reduce global scrutiny. Sources familiar with the matter told Bloomberg that the new strategy could be unveiled either before or after China announces its 15th Five-Year Plan in March 2026. The manufacturing focus will aim to stabilise the sector’s contribution to GDP and secure China’s position as a global tech powerhouse. US-China tariff tension This development comes at a time of rising trade tensions, with President Donald Trump’s administration pursuing what it calls “strategic decoupling” from China. In April, the US imposed fresh tariffs on Chinese electric vehicles, solar panels, and semiconductors, briefly raising some rates as high as 145 per cent. A subsequent agreement in Geneva reduced the average tariff to around 40 per cent, but the pressure on China remains intense. The US says it wants China to transition from an export-led growth model to one driven by domestic consumption. However, Chinese policymakers have resisted external calls to reduce industrial subsidies and market intervention, insisting that manufacturing remains key to national security and job creation. While the US argues that China needs to raise household consumption levels, Beijing is treading carefully. According to Bloomberg report, officials involved in drafting the upcoming Five-Year Plan are hesitant to include a numerical consumption target. The concern: China lacks the policy tools to boost spending significantly and sustainably. As it stands, household consumption accounts for only about 40 per cent of China’s GDP—well below the 50 to 70 per cent typical of more developed economies. By contrast, investment (largely in infrastructure and manufacturing) still comprises another 40 per cent, reflecting China’s unique growth model. Manufacturing remains the backbone of China During a visit to a ball-bearing factory in Henan on 19 May, President Xi Jinping reaffirmed China’s commitment to strengthening its manufacturing base. “We must keep strengthening the manufacturing sector, adhere to the principles of self-reliance and self-improvement, and master key core technologies,” Xi said, as quoted by Xinhua. This view has underpinned a decade-long push to achieve dominance in critical industries. The “Made in China 2025” plan targeted ten key sectors—from robotics and electric vehicles to aerospace and biomedicine. Bloomberg Intelligence research shows that China has already attained global leadership in five of those sectors and is catching up fast in seven others. What’s Xi’s Five-Year Plan? According to the South China Morning Post, the upcoming Five-Year Plan will focus on developing “new productive forces,” including electric vehicles, artificial intelligence, and new energy materials. Policymakers are also aiming to address bottlenecks in China’s supply chains and reduce reliance on foreign technologies. A report published by a newspaper overseen by the National Development and Reform Commission (NDRC) in March noted that promoting consumption and achieving breakthroughs in core technologies will be central to the plan. Research agencies have been instructed to prioritise semiconductor innovation and energy independence. Global implications China’s evolving industrial policy is likely to deepen the global divide over trade. The Biden administration had previously maintained a wait-and-watch approach, but Trump’s return has reignited tariff threats and supply chain shocks—prompting multinational firms to reassess manufacturing hubs. “Private investments… whatever interest rate cuts you do, I don’t think will move significantly higher simply because private investments will be determined more by a relatively certain atmosphere,” Indranil Pan, chief economist at Yes Bank, told Reuters. Meanwhile, Treasury Secretary Scott Bessent noted that both countries theoretically have complementary goals: “We need more manufacturing, they need more consumption. So there is a chance to rebalance together — we’ll see if that’s possible,” he said in an interview with CNBC on 12 May. China’s push to revive and upgrade its manufacturing agenda underscores a widening gulf between its long-term strategy and Washington’s expectations. While the US calls for rebalancing, China appears intent on doubling down on industrial strength, even as trade tensions threaten to escalate further. As the world’s two largest economies dig into opposing positions, the ripple effects on global trade, technology, and geopolitical alignment are bound to be far-reaching.

<p>Amid global trade pressure, the Xi Jinping's government is developing a new high-tech industrial policy to succeed "Made in China 2025," focusing on strategic sectors.&nbsp;</p>

Beijing pushes for a new Made-in-China plan amid Trump tariff pressure

<p>Beijing condemned on Wednesday new US warnings on the use of AI chips made in China, vowing it would take steps against "bullying" efforts to restrict access to high-tech semiconductors and supply chains.</p><p>Washington has sought in recent years to curb exports of state-of-the-art chips to China, concerned that they could be used to advance Beijing's military systems and otherwise undermine American dominance in AI.</p><p>US President Donald Trump's administration last week rescinded some export controls on advanced computing semiconductors, answering calls by countries that said they were being shut out from crucial technology needed to develop artificial intelligence.</p><p>Some US lawmakers feared the restrictions would have incentivised countries to go to China for AI chips, spurring the superpower's development of state-of-the-art technology.</p><p>But Washington also unveiled fresh guidelines warning firms that using Chinese-made high-tech AI semiconductors, specifically tech giant Huawei's Ascend chips, would put them at risk of violating US export controls.</p><p>In a statement Wednesday, Beijing's commerce ministry described the warnings as "typical unilateral bullying and protectionism, which seriously undermine the stability of the global semiconductor industry chain and supply chain".</p><p>China accused the US of "abusing export controls to suppress and contain China".</p><p>"These actions seriously harm the legitimate rights and interests of Chinese enterprises and endanger China's development interests," the commerce ministry said.</p><p>It also warned that "any organisation or individual that enforces or assists in enforcing such measures" could be in violation of Chinese law.</p><p>And it vowed to take "firm steps to safeguard its legitimate rights and interests" in response.</p><p>The United States warned last week about the potential consequences of allowing US AI chips to be used for training Chinese AI models.</p><p>The commerce department said its policy was aimed at sharing American AI technology "with trusted foreign countries around the world, while keeping the technology out of the hands of our adversaries".</p><p>Previous US rules divided countries into three tiers, each with its own level of restrictions.</p><p>Top-tier countries like Japan and South Korea faced no export restrictions, while countries in the second tier, which included Mexico and Portugal, saw a cap on the chips they could receive.</p><p>Chipmakers including Nvidia and AMD lobbied against the tiered restrictions and saw their share prices rise when the Trump administration indicated it would rethink the rule.</p>

"These actions seriously harm the legitimate rights and interests of Chinese enterprises and endanger China's development interests," said China's commerce ministry.

Beijing condemned on Wednesday new US warnings on the use of AI chips made in China, vowing it would take steps against "bullying" efforts to restrict access to high-tech semiconductors and supply chains. Washington has sought in recent years to curb exports of state-of-the-art chips to China, concerned that they could be used to advance Beijing's military systems and otherwise undermine American dominance in AI. US President Donald Trump's administration last week rescinded some export controls on advanced computing semiconductors, answering calls by countries that said they were being shut out from crucial technology needed to develop artificial intelligence. Some US lawmakers feared the restrictions would have incentivised countries to go to China for AI chips, spurring the superpower's development of state-of-the-art technology. But Washington also unveiled fresh guidelines warning firms that using Chinese-made high-tech AI semiconductors, specifically tech giant Huawei's Ascend chips, would put them at risk of violating US export controls. In a statement Wednesday, Beijing's commerce ministry described the warnings as "typical unilateral bullying and protectionism, which seriously undermine the stability of the global semiconductor industry chain and supply chain". China accused the US of "abusing export controls to suppress and contain China". "These actions seriously harm the legitimate rights and interests of Chinese enterprises and endanger China's development interests," the commerce ministry said. It also warned that "any organisation or individual that enforces or assists in enforcing such measures" could be in violation of Chinese law. And it vowed to take "firm steps to safeguard its legitimate rights and interests" in response. The United States warned last week about the potential consequences of allowing US AI chips to be used for training Chinese AI models. The commerce department said its policy was aimed at sharing American AI technology "with trusted foreign countries around the world, while keeping the technology out of the hands of our adversaries". Previous US rules divided countries into three tiers, each with its own level of restrictions. Top-tier countries like Japan and South Korea faced no export restrictions, while countries in the second tier, which included Mexico and Portugal, saw a cap on the chips they could receive. Chipmakers including Nvidia and AMD lobbied against the tiered restrictions and saw their share prices rise when the Trump administration indicated it would rethink the rule.

<p>"These actions seriously harm the legitimate rights and interests of Chinese enterprises and endanger China's development interests," said China's commerce ministry.</p>

China slams US over chip warning, claims America 'abusing export controls to suppress and contain' Beijing

<p>China’s smartphone exports to the US have plunged to their lowest level since 2011, reflecting a dramatic fallout from escalating trade tensions and renewed tariff threats.&nbsp;</p><p>&nbsp;</p><p>As global electronics supply chains recalibrate, India is fast emerging as the new pivot point in the tech manufacturing ecosystem.</p><p>&nbsp;</p><p><strong>China’s smartphone exports to US declines&nbsp;</strong></p><p><br>In April 2025, China’s mobile phone shipments to the US plummeted 72 per cent year-on-year to $688.5 million, the lowest monthly figure since June 2011, according to China’s General Administration of Customs, as reported by Bloomberg and Trade Data Monitor.&nbsp;</p><p>&nbsp;</p><p>This collapse outpaced the 21 per cent overall drop in Chinese exports to the US in the same period, underscoring how high-tech goods are being disproportionately impacted.</p><p>&nbsp;</p><p>New data shows that smartphones led the decline in export value in April 2025, with a month-on-month drop of $1.8 billion. Other top tech categories saw steep falls as well:</p><p>&nbsp;</p><p><strong>Top 10 Product Export Drops from China to US (April 2025, MoM change):&nbsp;</strong></p><figure class="table"><table><tbody><tr><td><strong>Product</strong></td><td><strong>Decline ($ Million)</strong></td></tr><tr><td>Smartphones</td><td>-1800.0</td></tr><tr><td>Laptops</td><td>-260.0</td></tr><tr><td>Solid State Disks (SSD)</td><td>-156.9</td></tr><tr><td>Video Game Consoles</td><td>-135.9</td></tr><tr><td>Optical Communication Modules</td><td>-87.0</td></tr><tr><td>Plastic Products</td><td>-86.7</td></tr><tr><td>Toys</td><td>-80.9</td></tr><tr><td>PC Monitors</td><td>-79.9</td></tr><tr><td>Plastic Tableware &amp; Kitchenware</td><td>-73.7</td></tr><tr><td>Wireless Headphones</td><td>-63.6</td></tr></tbody></table></figure><p>(Source: China’s General Administration of Customs, Trade Data Monitor)</p><p>&nbsp;</p><p><strong>US-China trade war saga&nbsp;</strong></p><p><br>The Trump administration has imposed tariffs of up to 145 per cent on select Chinese goods, including mobile phones and electronics, aiming to “protect American industry” and correct trade imbalances. However, analysts argue the levies are disrupting global tech supply chains, raising costs for US consumers, and forcing companies to rethink manufacturing strategies.</p><p><br>According to Bloomberg, investors fear this new wave of tariffs could reignite a full-blown global trade war, decimating industries, and triggering inflation across key consumer markets.</p><p><br>In a tit-for-tat response, China has rolled out its own reciprocal tariffs, targeting US exports like liquid petroleum gas, soybeans, gas turbines, and semiconductor machinery.&nbsp;</p><p><br>These items were among the top American goods exported to China last year.</p><p><br>Meanwhile, high-level trade negotiations in Geneva have hit a wall, with Beijing accusing Washington of sabotaging progress by announcing fresh sanctions on Huawei Technologies Co.’s AI chip units, just as the talks were underway.</p><p><br>Both sides have agreed to a 90-day pause on new tariffs, but the underlying tensions remain unresolved. Analysts say the truce may only be “temporary relief, not a breakthrough.”</p><p><br>The stakes are massive. In 2024, US-China bilateral trade totaled $690 billion, with smartphones, laptops, and lithium-ion batteries topping the list of US imports from China, according to Trade Data Monitor. That flow is now under direct threat.</p><p><br>Tariff-led uncertainty is causing companies to hedge their bets—and China’s smartphone export data is one of the clearest signs yet.</p><p><br><strong>India emerges as the big winner</strong></p><p><br>As the US and China clash, India is emerging as a strategic alternative in global electronics manufacturing. Apple Inc. is accelerating its shift of iPhone production to India.&nbsp;</p><p><br>According to China’s General Administration of Customs, the value of smartphone component exports from China to India has roughly quadrupled over the past year.</p><p><br>India now hosts Apple’s largest iPhone production base outside of China, serving as a key assembly hub. More parts are being shipped from China to India, then exported to global markets including the US to bypass tariff penalties.</p><p><br>But Trump has pushed back on this workaround, publicly urging Apple to “bring iPhone manufacturing home.” However, experts point out that iPhones have never been made in the US, and the infrastructure needed for such a shift is still years away.</p><p><br>The 14-year low in smartphone exports signals more than just a trade slowdown, it represents a strategic decoupling in tech.&nbsp;</p><p>&nbsp;</p><p>With tariffs rising, trust fading, and sanctions increasing, the smartphone war could be just the beginning of a broader economic cold war.</p><p>&nbsp;</p>

The decline in smartphone export reflects a dramatic fallout from escalating trade tensions and renewed tariff threats. 

China’s smartphone exports to the US have plunged to their lowest level since 2011, reflecting a dramatic fallout from escalating trade tensions and renewed tariff threats. As global electronics supply chains recalibrate, India is fast emerging as the new pivot point in the tech manufacturing ecosystem. China’s smartphone exports to US declines In April 2025, China’s mobile phone shipments to the US plummeted 72 per cent year-on-year to $688.5 million, the lowest monthly figure since June 2011, according to China’s General Administration of Customs, as reported by Bloomberg and Trade Data Monitor. This collapse outpaced the 21 per cent overall drop in Chinese exports to the US in the same period, underscoring how high-tech goods are being disproportionately impacted. New data shows that smartphones led the decline in export value in April 2025, with a month-on-month drop of $1.8 billion. Other top tech categories saw steep falls as well: Top 10 Product Export Drops from China to US (April 2025, MoM change): Product Decline ($ Million) Smartphones -1800.0 Laptops -260.0 Solid State Disks (SSD) -156.9 Video Game Consoles -135.9 Optical Communication Modules -87.0 Plastic Products -86.7 Toys -80.9 PC Monitors -79.9 Plastic Tableware & Kitchenware -73.7 Wireless Headphones -63.6 (Source: China’s General Administration of Customs, Trade Data Monitor) US-China trade war saga The Trump administration has imposed tariffs of up to 145 per cent on select Chinese goods, including mobile phones and electronics, aiming to “protect American industry” and correct trade imbalances. However, analysts argue the levies are disrupting global tech supply chains, raising costs for US consumers, and forcing companies to rethink manufacturing strategies. According to Bloomberg, investors fear this new wave of tariffs could reignite a full-blown global trade war, decimating industries, and triggering inflation across key consumer markets. In a tit-for-tat response, China has rolled out its own reciprocal tariffs, targeting US exports like liquid petroleum gas, soybeans, gas turbines, and semiconductor machinery. These items were among the top American goods exported to China last year. Meanwhile, high-level trade negotiations in Geneva have hit a wall, with Beijing accusing Washington of sabotaging progress by announcing fresh sanctions on Huawei Technologies Co.’s AI chip units, just as the talks were underway. Both sides have agreed to a 90-day pause on new tariffs, but the underlying tensions remain unresolved. Analysts say the truce may only be “temporary relief, not a breakthrough.” The stakes are massive. In 2024, US-China bilateral trade totaled $690 billion, with smartphones, laptops, and lithium-ion batteries topping the list of US imports from China, according to Trade Data Monitor. That flow is now under direct threat. Tariff-led uncertainty is causing companies to hedge their bets—and China’s smartphone export data is one of the clearest signs yet. India emerges as the big winner As the US and China clash, India is emerging as a strategic alternative in global electronics manufacturing. Apple Inc. is accelerating its shift of iPhone production to India. According to China’s General Administration of Customs, the value of smartphone component exports from China to India has roughly quadrupled over the past year. India now hosts Apple’s largest iPhone production base outside of China, serving as a key assembly hub. More parts are being shipped from China to India, then exported to global markets including the US to bypass tariff penalties. But Trump has pushed back on this workaround, publicly urging Apple to “bring iPhone manufacturing home.” However, experts point out that iPhones have never been made in the US, and the infrastructure needed for such a shift is still years away. The 14-year low in smartphone exports signals more than just a trade slowdown, it represents a strategic decoupling in tech. With tariffs rising, trust fading, and sanctions increasing, the smartphone war could be just the beginning of a broader economic cold war.

<p>Amid global trade tension due to Trump tariff, China’s smartphone exports to the US have plunged to their lowest level since 2011.&nbsp;</p>

China’s smartphone exports to US crash to 14-year low amid trade war

<p>China’s battery behemoth CATL just pulled off the biggest IPO of the year, but the buzz around its $4.6 billion Hong Kong debut wasn’t just about market performance, it was about who <i>wasn’t</i>&nbsp;allowed to invest.<br>&nbsp;</p><p>In a striking sign of deepening US-China financial tensions, onshore American investors were reportedly barred from buying shares of CATL, the world’s largest EV battery maker and a key supplier to Tesla, Volkswagen, and Toyota.&nbsp;</p><p>&nbsp;</p><p>The move underscored a growing “financial decoupling” between the world’s two largest economies. Economist Stephen Roach, former chairman of Morgan Stanley Asia, told The New York Times that “we are headed toward full financial decoupling with China” and added that “Congress is driving the process of disengagement.”</p><p>&nbsp;</p><p><strong>Why is CATL’s IPO a big deal?</strong></p><p>&nbsp;</p><p>Contemporary Amperex Technology Co. Limited (CATL) dominates the global electric vehicle battery market, controlling more than one-third of global EV battery sales, according to the BBC. The company is a cornerstone of China’s green tech ambitions and is rapidly expanding overseas, with manufacturing plants in Germany and Hungary, and an upcoming factory in Spain in partnership with Stellantis.<br>&nbsp;</p><p>Although already listed on the Shenzhen Stock Exchange, CATL raised HK$35.7 billion ($4.55 billion) in its Hong Kong debut — the largest public offering of 2025 so far, according to data provider Dealogic, as reported by The New York Times.&nbsp;</p><p>&nbsp;</p><p>Neil Beveridge, head of Asia research at Bernstein, told the BBC that “the performance of the stock was very good in what is going to be a key IPO for Hong Kong given the size of the listing.”</p><p>&nbsp;</p><p><strong>Why were US investors barred?</strong><br>&nbsp;</p><p>The exclusion of onshore US investors from CATL’s Hong Kong listing was a direct result of escalating geopolitical tensions. In January, the US Department of Defense designated CATL as a company allegedly working with China’s military, a move that was reported by both the BBC and The New York Times.&nbsp;</p><p>&nbsp;</p><p>Then in April, the chair of the House Select Committee on China wrote to the CEOs of JPMorgan and Bank of America, urging them to withdraw from the IPO, according to the BBC. In addition, The New York Times reported that US lawmakers lobbied Wall Street banks to distance themselves from the deal, citing national security concerns.</p><p>&nbsp;</p><p>Facing mounting scrutiny, CATL restructured its IPO as a Regulation S offering, effectively barring onshore US investors and avoiding certain regulatory filings in the United States. In regulatory documents, the company admitted that it faces “risks associated with changes in trade policies or tariff regulations,” as reported by The New York Times.&nbsp;</p><p>&nbsp;</p><p>CATL also strongly denied any ties to military operations, stating it “has never engaged in any military-related businesses or activities” and had reached out to the Department of Defense to challenge what it called a false designation.</p><p>&nbsp;</p><p><strong>The bigger picture: Financial decoupling</strong></p><p><br>CATL’s listing marks a dramatic reversal from the earlier trend of Chinese tech firms pursuing Wall Street debuts. When Alibaba went public on the New York Stock Exchange in 2014, it raised $21.8 billion and was celebrated by American investors and bankers.&nbsp;</p><p>&nbsp;</p><p>But according to The New York Times, the current climate is very different, with Chinese companies increasingly steering clear of US markets due to both political pressures and policy constraints.</p><p>&nbsp;</p><p>Experts believe this may just be the beginning. Victor Shih, a specialist in Chinese finance at the University of California, San Diego, told The New York Times that CATL’s IPO structure represents “a major milestone” and predicted that “this will apply to many Chinese hardware and even some software producers,” effectively shutting out American investors from future high-growth opportunities. He estimated that around 10 per cent of US investors might have participated in the CATL IPO had they not been restricted.</p><p>&nbsp;</p><p><strong>Can tariffs hurt CATL?</strong></p><p>&nbsp;</p><p>Not as much as one might expect. CATL generates nearly 70 per cent of its revenue from the Chinese market, which has helped buffer the company against the effects of US-imposed tariffs, according to the BBC.&nbsp;</p><p>&nbsp;</p><p>Despite trade headwinds, CATL continues to be a global innovation leader. In April, it unveiled a new battery capable of fast-charging up to 323 miles (520 kilometers) in just five minutes, as reported by the BBC.&nbsp;</p><p>&nbsp;</p><p>The company also provides lithium iron phosphate batteries to Tesla’s Shanghai Gigafactory, further cementing its global presence.</p>

CATL $4.6 billion Hong Kong debut wasn’t just about market performance, it was about who wasn’t allowed to invest.

China’s battery behemoth CATL just pulled off the biggest IPO of the year, but the buzz around its $4.6 billion Hong Kong debut wasn’t just about market performance, it was about who wasn’t allowed to invest. In a striking sign of deepening US-China financial tensions, onshore American investors were reportedly barred from buying shares of CATL, the world’s largest EV battery maker and a key supplier to Tesla, Volkswagen, and Toyota. The move underscored a growing “financial decoupling” between the world’s two largest economies. Economist Stephen Roach, former chairman of Morgan Stanley Asia, told The New York Times that “we are headed toward full financial decoupling with China” and added that “Congress is driving the process of disengagement.” Why is CATL’s IPO a big deal? Contemporary Amperex Technology Co. Limited (CATL) dominates the global electric vehicle battery market, controlling more than one-third of global EV battery sales, according to the BBC. The company is a cornerstone of China’s green tech ambitions and is rapidly expanding overseas, with manufacturing plants in Germany and Hungary, and an upcoming factory in Spain in partnership with Stellantis. Although already listed on the Shenzhen Stock Exchange, CATL raised HK$35.7 billion ($4.55 billion) in its Hong Kong debut — the largest public offering of 2025 so far, according to data provider Dealogic, as reported by The New York Times. Neil Beveridge, head of Asia research at Bernstein, told the BBC that “the performance of the stock was very good in what is going to be a key IPO for Hong Kong given the size of the listing.” Why were US investors barred? The exclusion of onshore US investors from CATL’s Hong Kong listing was a direct result of escalating geopolitical tensions. In January, the US Department of Defense designated CATL as a company allegedly working with China’s military, a move that was reported by both the BBC and The New York Times. Then in April, the chair of the House Select Committee on China wrote to the CEOs of JPMorgan and Bank of America, urging them to withdraw from the IPO, according to the BBC. In addition, The New York Times reported that US lawmakers lobbied Wall Street banks to distance themselves from the deal, citing national security concerns. Facing mounting scrutiny, CATL restructured its IPO as a Regulation S offering, effectively barring onshore US investors and avoiding certain regulatory filings in the United States. In regulatory documents, the company admitted that it faces “risks associated with changes in trade policies or tariff regulations,” as reported by The New York Times. CATL also strongly denied any ties to military operations, stating it “has never engaged in any military-related businesses or activities” and had reached out to the Department of Defense to challenge what it called a false designation. The bigger picture: Financial decoupling CATL’s listing marks a dramatic reversal from the earlier trend of Chinese tech firms pursuing Wall Street debuts. When Alibaba went public on the New York Stock Exchange in 2014, it raised $21.8 billion and was celebrated by American investors and bankers. But according to The New York Times, the current climate is very different, with Chinese companies increasingly steering clear of US markets due to both political pressures and policy constraints. Experts believe this may just be the beginning. Victor Shih, a specialist in Chinese finance at the University of California, San Diego, told The New York Times that CATL’s IPO structure represents “a major milestone” and predicted that “this will apply to many Chinese hardware and even some software producers,” effectively shutting out American investors from future high-growth opportunities. He estimated that around 10 per cent of US investors might have participated in the CATL IPO had they not been restricted. Can tariffs hurt CATL? Not as much as one might expect. CATL generates nearly 70 per cent of its revenue from the Chinese market, which has helped buffer the company against the effects of US-imposed tariffs, according to the BBC. Despite trade headwinds, CATL continues to be a global innovation leader. In April, it unveiled a new battery capable of fast-charging up to 323 miles (520 kilometers) in just five minutes, as reported by the BBC. The company also provides lithium iron phosphate batteries to Tesla’s Shanghai Gigafactory, further cementing its global presence.

<p>Amid global trade tension, China’s battery behemoth Contemporary Amperex Technology Co. Limited (CATL) just pulled off the biggest IPO of the year.</p>

How the US-China trade war shaped CATL’s blockbuster Hong Kong debut

<p>China's central bank, the People's Bank of China (PBOC), lowered its key lending rates for the first time since October as part of a broader effort to stabilise the country’s economy amid ongoing trade tensions with the United States.</p><p>&nbsp;</p><p>On May 20, the PBOC cut the one-year loan prime rate (LPR) by 10 basis points to 3.0 per cent from 3.1 per cent and the five-year LPR by a similar margin to 3.5 per cent from 3.6 per cent. These cuts aim to stimulate consumption, encourage borrowing, and ultimately help offset economic challenges such as weak domestic demand and deflationary pressures.</p><p>&nbsp;</p><p><strong>Economic impact</strong></p><p>&nbsp;</p><p>The decision to reduce the LPR follows a series of monetary easing measures that the PBOC has been implementing in response to slowing economic growth. The LPR serves as a benchmark for the interest rates charged on loans, including mortgages, and influences both corporate and household borrowing. The one-year LPR, in particular, is vital for short-term loans, while the five-year rate directly impacts mortgage lending, making this decision significant for the housing market.</p><p>&nbsp;</p><p>The rate cuts were widely anticipated by analysts, with many forecasting a 10-basis-point reduction. This move comes after a period of escalating trade tensions between the US and China, which had put substantial strain on both economies.</p><p>&nbsp;</p><p>However, the recent easing of tensions, following a temporary tariff reduction agreement between the two countries, has provided some breathing room for China to implement its monetary policy. The US and China agreed to roll back tariffs for 90 days, which has raised hopes of a more lasting resolution to the trade war.</p><p>&nbsp;</p><p>While the rate cuts are seen as a step in the right direction, economists warn that modest interest rate reductions alone may not be enough to generate substantial economic growth.</p><p>&nbsp;</p><p><strong>Strategic policy adjustments</strong></p><p>&nbsp;</p><p>In addition to the rate cuts, Chinese authorities have also implemented measures to ease liquidity conditions by lowering the reserve requirement ratio for banks. This move aims to free up more funds for lending and investment, further supporting economic activity.</p><p>&nbsp;</p><p>These steps come in the wake of weakening economic indicators, including a sharp decline in new loans, which plummeted by 61 per cent year-over-year in April, signalling diminished confidence in borrowing due to tariff concerns.</p><p>&nbsp;</p><p>Morgan Stanley economists told CNBC that stimulus measures are likely to be "lighter and delayed" due to the reduced likelihood of further escalations in the trade war. However, the firm also cautioned that despite the tariff reduction, the US trade-weighted tariff rate on China remains high, which could continue to dampen external demand for Chinese exports and exacerbate domestic overcapacity issues.</p><p>&nbsp;</p><p>The decision to cut rates comes as part of a broader economic strategy that includes both monetary and fiscal easing, aimed at navigating the challenges posed by deflation and sluggish domestic consumption. Wholesale prices in China fell sharply in April, marking the steepest drop in six months, and consumer prices have been in decline for three consecutive months, underscoring persistent deflationary pressure.</p><p>&nbsp;</p><p>Despite the favourable impact of the trade de-escalation on the yuan, which has strengthened by over 2.8 per cent against the US dollar since reaching a record low last month, the overall economic outlook remains uncertain.</p><p>&nbsp;</p><p>As China pushes forward with its stimulus measures, the government's goal of achieving a growth target of around 5 per cent for the year seems increasingly dependent on the success of these policies.</p><p>&nbsp;</p><p>The combination of lower interest rates, fiscal stimulus, and trade negotiations presents a delicate balancing act for Beijing, which must navigate deflation, sluggish demand, and trade risks to achieve its growth objectives for 2025.</p><p><br>&nbsp;</p>

These cuts aim to stimulate consumption, encourage borrowing, and ultimately help offset economic challenges such as weak domestic demand and deflationary pressures.

China's central bank, the People's Bank of China (PBOC), lowered its key lending rates for the first time since October as part of a broader effort to stabilise the country’s economy amid ongoing trade tensions with the United States. On May 20, the PBOC cut the one-year loan prime rate (LPR) by 10 basis points to 3.0 per cent from 3.1 per cent and the five-year LPR by a similar margin to 3.5 per cent from 3.6 per cent. These cuts aim to stimulate consumption, encourage borrowing, and ultimately help offset economic challenges such as weak domestic demand and deflationary pressures. Economic impact The decision to reduce the LPR follows a series of monetary easing measures that the PBOC has been implementing in response to slowing economic growth. The LPR serves as a benchmark for the interest rates charged on loans, including mortgages, and influences both corporate and household borrowing. The one-year LPR, in particular, is vital for short-term loans, while the five-year rate directly impacts mortgage lending, making this decision significant for the housing market. The rate cuts were widely anticipated by analysts, with many forecasting a 10-basis-point reduction. This move comes after a period of escalating trade tensions between the US and China, which had put substantial strain on both economies. However, the recent easing of tensions, following a temporary tariff reduction agreement between the two countries, has provided some breathing room for China to implement its monetary policy. The US and China agreed to roll back tariffs for 90 days, which has raised hopes of a more lasting resolution to the trade war. While the rate cuts are seen as a step in the right direction, economists warn that modest interest rate reductions alone may not be enough to generate substantial economic growth. Strategic policy adjustments In addition to the rate cuts, Chinese authorities have also implemented measures to ease liquidity conditions by lowering the reserve requirement ratio for banks. This move aims to free up more funds for lending and investment, further supporting economic activity. These steps come in the wake of weakening economic indicators, including a sharp decline in new loans, which plummeted by 61 per cent year-over-year in April, signalling diminished confidence in borrowing due to tariff concerns. Morgan Stanley economists told CNBC that stimulus measures are likely to be "lighter and delayed" due to the reduced likelihood of further escalations in the trade war. However, the firm also cautioned that despite the tariff reduction, the US trade-weighted tariff rate on China remains high, which could continue to dampen external demand for Chinese exports and exacerbate domestic overcapacity issues. The decision to cut rates comes as part of a broader economic strategy that includes both monetary and fiscal easing, aimed at navigating the challenges posed by deflation and sluggish domestic consumption. Wholesale prices in China fell sharply in April, marking the steepest drop in six months, and consumer prices have been in decline for three consecutive months, underscoring persistent deflationary pressure. Despite the favourable impact of the trade de-escalation on the yuan, which has strengthened by over 2.8 per cent against the US dollar since reaching a record low last month, the overall economic outlook remains uncertain. As China pushes forward with its stimulus measures, the government's goal of achieving a growth target of around 5 per cent for the year seems increasingly dependent on the success of these policies. The combination of lower interest rates, fiscal stimulus, and trade negotiations presents a delicate balancing act for Beijing, which must navigate deflation, sluggish demand, and trade risks to achieve its growth objectives for 2025.

<p>On May 20, the Central bank of China cut the one-year loan prime rate (LPR) by 10 basis points to 3.0 per cent from 3.1 per cent and the five-year LPR by a similar margin to 3.5 per cent from 3.6 per cent.&nbsp;</p>

China cuts key lending rates to boost economic recovery amid trade war concerns

<div class="x_elementToProof" data-olk-copy-source="MessageBody">China&rsquo;s economy is showing a fresh sign of deflationary strain.&nbsp;According to data from the National Bureau of Statistics,&nbsp;as reported by Reuters, consumer prices fell for a third consecutive month in April. This highlights growing economic uncertainty as the US-China trade war escalates.</div>
<div class="x_elementToProof">The Consumer Price Index (CPI) dropped 0.1 per cent year-on-year, mirroring the decline in March and aligning with economists&rsquo; forecasts. On a monthly basis, CPI edged up slightly by 0.1 per cent, reversing a 0.4 per cent fall in the previous month. Meanwhile, the Producer Price Index (PPI), which tracks the cost of goods at the factory gate, fell 2.7 per cent year-on-year, deepening from a 2.5 per cent decline in March. The continued drop in prices signals weak domestic demand and adds to the fear that the world&rsquo;s second-largest economy is sliding deeper into deflation.</div>
<div class="x_elementToProof"></div>
<div class="x_elementToProof">This economic fragility of China comes at a time when Beijing is facing intensifying trade tensions with Washington.</div>
<h2 class="x_elementToProof"><b>US-China trade talks resume amid fresh tariff threats</b><b></b></h2>
<div class="x_elementToProof">On May 9, 2025, just a day before the Geneva summit, US President Donald Trump reaffirmed his administration&rsquo;s commitment to maintaining a baseline 10 per cent tariff on imports, even after trade deals are finalised. He also suggested the possibility of increasing tariffs on Chinese goods to 80 per cent, a reduction from the previously imposed 145 per cent levies. These statements set the tone for the high-stakes trade talks scheduled for May 10 in Geneva between US Treasury Secretary Scott Bessent, Chief Trade Negotiator Jamieson Greer, and China&rsquo;s Vice Premier He Lifeng. The discussions mark the first formal engagement between the two nations since the escalation of the tariff war earlier this year.</div>
<div class="x_elementToProof">The backdrop to these talks is a series of escalating trade measures. In April 2025, President Trump imposed a 145 per cent&nbsp;tariff on Chinese imports, citing concerns over trade imbalances and national security. China swiftly retaliated with a 125 per cent tariff on US goods, leading to a significant downturn in bilateral trade. Despite the tensions, both countries have expressed a cautious willingness to return to the negotiating table, with China emphasising&nbsp;the need for &ldquo;equal consultation&rdquo; and mutual respect in resolving trade disputes.</div>
<h2 class="x_elementToProof"><b>Impact of the Trade War on China</b></h2>
<div class="x_elementToProof">The ongoing trade tensions have had a tangible impact on China&rsquo;s economy. The services sector, which makes up a significant portion of the country&rsquo;s GDP, is showing signs of slowdown. According to a Reuters report published on May 7, China&rsquo;s Caixin/S&amp;P Global Services Purchasing Managers&rsquo; Index (PMI) &nbsp;slipped to 50.7 in April from 51.9 in March, while the official services PMI dipped to 50.1, just above the contraction line. Meanwhile, exports to the US fell sharply, dropping 17.6 per cent month-on-month from $40.1 billion in March to $33.0 billion in April, marking the lowest level in five years. In response, the People&rsquo;s Bank of China (PBOC) announced a set of monetary easing measures by cutting the seven-day reverse repo rate by 10 basis points to 1.40 per cent and lowering the reserve requirement ratio by 50 basis points, expected to inject about 1 trillion yuan ($138 billion) into the economy.</div>
<div class="x_elementToProof"></div>

Business & Economy: Deflation concerns deepen in China as consumer prices fall for the third consecutive month. This comes ahead of the US-China trade meet in Geneva on May 10.

China’s economy is showing a fresh sign of deflationary strain. According to data from the National Bureau of Statistics, as reported by Reuters, consumer prices fell for a third consecutive month in April. This highlights growing economic uncertainty as the US-China trade war escalates. The Consumer Price Index (CPI) dropped 0.1 per cent year-on-year, mirroring the decline in March and aligning with economists’ forecasts. On a monthly basis, CPI edged up slightly by 0.1 per cent, reversing a 0.4 per cent fall in the previous month. Meanwhile, the Producer Price Index (PPI), which tracks the cost of goods at the factory gate, fell 2.7 per cent year-on-year, deepening from a 2.5 per cent decline in March. The continued drop in prices signals weak domestic demand and adds to the fear that the world’s second-largest economy is sliding deeper into deflation. This economic fragility of China comes at a time when Beijing is facing intensifying trade tensions with Washington. US-China trade talks resume amid fresh tariff threats On May 9, 2025, just a day before the Geneva summit, US President Donald Trump reaffirmed his administration’s commitment to maintaining a baseline 10 per cent tariff on imports, even after trade deals are finalised. He also suggested the possibility of increasing tariffs on Chinese goods to 80 per cent, a reduction from the previously imposed 145 per cent levies. These statements set the tone for the high-stakes trade talks scheduled for May 10 in Geneva between US Treasury Secretary Scott Bessent, Chief Trade Negotiator Jamieson Greer, and China’s Vice Premier He Lifeng. The discussions mark the first formal engagement between the two nations since the escalation of the tariff war earlier this year. The backdrop to these talks is a series of escalating trade measures. In April 2025, President Trump imposed a 145 per cent tariff on Chinese imports, citing concerns over trade imbalances and national security. China swiftly retaliated with a 125 per cent tariff on US goods, leading to a significant downturn in bilateral trade. Despite the tensions, both countries have expressed a cautious willingness to return to the negotiating table, with China emphasising the need for “equal consultation” and mutual respect in resolving trade disputes. Impact of the Trade War on China The ongoing trade tensions have had a tangible impact on China’s economy. The services sector, which makes up a significant portion of the country’s GDP, is showing signs of slowdown. According to a Reuters report published on May 7, China’s Caixin/S&P Global Services Purchasing Managers’ Index (PMI) slipped to 50.7 in April from 51.9 in March, while the official services PMI dipped to 50.1, just above the contraction line. Meanwhile, exports to the US fell sharply, dropping 17.6 per cent month-on-month from $40.1 billion in March to $33.0 billion in April, marking the lowest level in five years. In response, the People’s Bank of China (PBOC) announced a set of monetary easing measures by cutting the seven-day reverse repo rate by 10 basis points to 1.40 per cent and lowering the reserve requirement ratio by 50 basis points, expected to inject about 1 trillion yuan ($138 billion) into the economy.

China faces deepening deflation as consumer prices fall for third month due to US trade strain

<div class="x_elementToProof" data-olk-copy-source="MessageBody">China&rsquo;s services sector experienced its slowest growth in seven months this April, as escalating US tariffs dampened business sentiment and hiring plans. According to Reuters, the Caixin/S&amp;P Global Services Purchasing Managers&rsquo; Index (PMI) fell to 50.7 from March&rsquo;s 51.9, marking the lowest reading since September. A PMI above 50 indicates expansion, while below 50 signifies contraction.</div>
<div class="x_elementToProof"></div>
<div class="x_elementToProof">This deceleration aligns with the official survey, which reported a slight dip in services activity to 50.1 from 50.3 the previous month. The Caixin PMI is often viewed as a more accurate reflection of trends among export-oriented and smaller firms.</div>
<div class="x_elementToProof"></div>
<div class="x_elementToProof">Despite stronger-than-expected economic growth in the first quarter, bolstered by government stimulus, China&rsquo;s economy faces persistent deflationary risks, a prolonged property slump, and mounting challenges from US tariffs. In 2023, approximately 48 per cent of China&rsquo;s workforce was employed in the services industry, which contributed 56.7 per cent to the nation&rsquo;s GDP. However, the ongoing trade tensions have begun to weigh on business hiring plans and consumer confidence.</div>
<div class="x_elementToProof"></div>
<div class="x_elementToProof">&ldquo;With a cloud over the market outlook, both business and consumer confidence are subdued, making it harder to boost domestic demand,&rdquo; said Wang Zhe, Senior Economist at Caixin Insight Group, as reported by Reuters. &ldquo;The ripple effects of the ongoing China-US tariff standoff will gradually be felt in the second and third quarters. As such, policymakers should prepare well and take action sooner rather than later,&rdquo; he added.</div>
<div class="x_elementToProof"></div>
<div class="x_elementToProof">The Caixin services survey indicated that new business growth slowed to its weakest since December 2022, though export orders saw a slight uptick, partly due to a recovery in tourism. Some service providers cited disruptions from US tariffs impacting goods trade.</div>
<div class="x_elementToProof"></div>
<div class="x_elementToProof">Business sentiment in the services sector grew at the slowest pace since February 2020, with companies identifying US tariffs as a significant concern. To curb costs, service providers reduced jobs for the second consecutive month, leading to a rise in backlogged work and pushing the corresponding gauge into expansionary territory for the first time this year. Firms also cut prices to attract customers, despite facing higher input costs.</div>
<div class="x_elementToProof"></div>
<div class="x_elementToProof">The Caixin China General Composite PMI, which combines both manufacturing and services activity, fell to 51.1 in April from 51.8 the previous month.</div>
<div class="x_elementToProof"></div>
<div class="x_elementToProof">In response to these challenges, China&rsquo;s ruling Communist Party&rsquo;s Politburo pledged last month to support firms and workers most affected by the impact of triple-digit US tariffs and urged the country to prepare for worst-case scenarios. Economists at Morgan Stanley projected that second-quarter growth could slow by one percentage point as tariffs take effect. They anticipate that Beijing will navigate these challenges with cautious and uneven stimulus policies, relying on investment in emerging sectors and urban renewal, while gradually shifting policy towards consumption over the medium term.</div>
<div class="x_elementToProof"></div>
<div class="x_elementToProof">The ongoing trade tensions have also impacted other sectors. For instance, Hong Kong&rsquo;s freight forwarding industry is experiencing significant disruptions, with 41 per cent of container capacity to North America&rsquo;s west coast canceled for the week starting May 12, according to the South China Morning Post, as reported by Reuters. This highlights the broader economic implications of the US-China trade war, signaling further turbulence ahead for both regional logistics and global trade infrastructure.</div>
<div class="x_elementToProof"></div>
<div class="x_elementToProof"><b>The US-China trade talks</b></div>
<div class="x_elementToProof"><b>&nbsp;</b></div>
<div class="x_elementToProof">In April 2025, President Donald Trump escalated the trade conflict with China by imposing a 145 per cent tariff on Chinese imports, citing concerns over trade imbalances and national security. In retaliation, China levied a 125 per cent tariff on US goods, triggering a sharp downturn in bilateral trade.</div>
<div class="x_elementToProof"></div>
<div class="x_elementToProof">Despite the friction, both countries have signalled cautious interest in returning to the negotiating table. China&rsquo;s Ministry of Commerce said it is &ldquo;evaluating&rdquo; Washington&rsquo;s outreach for potential tariff talks but rejected any form of intimidation. Trump, meanwhile, reaffirmed he would not drop tariffs just to resume dialogue, demanding what he calls a &ldquo;fair and reciprocal&rdquo; trade deal.</div>
<div class="x_elementToProof"></div>
<div class="x_elementToProof">On May 5, 2025, China&rsquo;s Ministry of Commerce issued a firm rebuttal to US pressure tactics. Ministry spokesperson He Yongqian stated, &ldquo;Pressure, threats and blackmail are not the right way to deal with China. We hope that the two countries will meet each other halfway and work towards resolving differences through dialogue and consultation, guided by the principles of mutual respect, peaceful coexistence and win-win cooperation.&rdquo;</div>
<div class="x_elementToProof"></div>
<div class="x_elementToProof">He added that if the US insists on pursuing a trade war, China is prepared to &ldquo;fight to the end.&rdquo; However, the country remains open to fair negotiations conducted on equal terms. To counter the impact of tariffs, Beijing is advancing economic resilience strategies&mdash;boosting domestic demand through consumer trade-in programs, promoting premium goods events, and encouraging foreign trade firms to tap into China&rsquo;s vast local market.</div>
<div class="x_elementToProof"></div>
<div class="x_elementToProof">&ldquo;We can see that the potential of China&rsquo;s super-large domestic market is constantly being unleashed,&rdquo; He said. &ldquo;China&rsquo;s foreign trade sector has the confidence and capability to withstand various risk challenges.&rdquo;</div>

Business & Economy: China’s services growth slows amid US tariffs. Caixin PMI drops to 50.7. Beijing urges fair talks, warns against pressure as trade war intensifies.

China’s services sector experienced its slowest growth in seven months this April, as escalating US tariffs dampened business sentiment and hiring plans. According to Reuters, the Caixin/S&P Global Services Purchasing Managers’ Index (PMI) fell to 50.7 from March’s 51.9, marking the lowest reading since September. A PMI above 50 indicates expansion, while below 50 signifies contraction. This deceleration aligns with the official survey, which reported a slight dip in services activity to 50.1 from 50.3 the previous month. The Caixin PMI is often viewed as a more accurate reflection of trends among export-oriented and smaller firms. Despite stronger-than-expected economic growth in the first quarter, bolstered by government stimulus, China’s economy faces persistent deflationary risks, a prolonged property slump, and mounting challenges from US tariffs. In 2023, approximately 48 per cent of China’s workforce was employed in the services industry, which contributed 56.7 per cent to the nation’s GDP. However, the ongoing trade tensions have begun to weigh on business hiring plans and consumer confidence. “With a cloud over the market outlook, both business and consumer confidence are subdued, making it harder to boost domestic demand,” said Wang Zhe, Senior Economist at Caixin Insight Group, as reported by Reuters. “The ripple effects of the ongoing China-US tariff standoff will gradually be felt in the second and third quarters. As such, policymakers should prepare well and take action sooner rather than later,” he added. The Caixin services survey indicated that new business growth slowed to its weakest since December 2022, though export orders saw a slight uptick, partly due to a recovery in tourism. Some service providers cited disruptions from US tariffs impacting goods trade. Business sentiment in the services sector grew at the slowest pace since February 2020, with companies identifying US tariffs as a significant concern. To curb costs, service providers reduced jobs for the second consecutive month, leading to a rise in backlogged work and pushing the corresponding gauge into expansionary territory for the first time this year. Firms also cut prices to attract customers, despite facing higher input costs. The Caixin China General Composite PMI, which combines both manufacturing and services activity, fell to 51.1 in April from 51.8 the previous month. In response to these challenges, China’s ruling Communist Party’s Politburo pledged last month to support firms and workers most affected by the impact of triple-digit US tariffs and urged the country to prepare for worst-case scenarios. Economists at Morgan Stanley projected that second-quarter growth could slow by one percentage point as tariffs take effect. They anticipate that Beijing will navigate these challenges with cautious and uneven stimulus policies, relying on investment in emerging sectors and urban renewal, while gradually shifting policy towards consumption over the medium term. The ongoing trade tensions have also impacted other sectors. For instance, Hong Kong’s freight forwarding industry is experiencing significant disruptions, with 41 per cent of container capacity to North America’s west coast canceled for the week starting May 12, according to the South China Morning Post, as reported by Reuters. This highlights the broader economic implications of the US-China trade war, signaling further turbulence ahead for both regional logistics and global trade infrastructure. The US-China trade talks In April 2025, President Donald Trump escalated the trade conflict with China by imposing a 145 per cent tariff on Chinese imports, citing concerns over trade imbalances and national security. In retaliation, China levied a 125 per cent tariff on US goods, triggering a sharp downturn in bilateral trade. Despite the friction, both countries have signalled cautious interest in returning to the negotiating table. China’s Ministry of Commerce said it is “evaluating” Washington’s outreach for potential tariff talks but rejected any form of intimidation. Trump, meanwhile, reaffirmed he would not drop tariffs just to resume dialogue, demanding what he calls a “fair and reciprocal” trade deal. On May 5, 2025, China’s Ministry of Commerce issued a firm rebuttal to US pressure tactics. Ministry spokesperson He Yongqian stated, “Pressure, threats and blackmail are not the right way to deal with China. We hope that the two countries will meet each other halfway and work towards resolving differences through dialogue and consultation, guided by the principles of mutual respect, peaceful coexistence and win-win cooperation.” He added that if the US insists on pursuing a trade war, China is prepared to “fight to the end.” However, the country remains open to fair negotiations conducted on equal terms. To counter the impact of tariffs, Beijing is advancing economic resilience strategies—boosting domestic demand through consumer trade-in programs, promoting premium goods events, and encouraging foreign trade firms to tap into China’s vast local market. “We can see that the potential of China’s super-large domestic market is constantly being unleashed,” He said. “China’s foreign trade sector has the confidence and capability to withstand various risk challenges.”

US tariffs stall China’s services growth: PMI hits 7-month low as trade tensions escalate

<p>China has set its fiscal deficit target for 2025 at a record 5.66 trillion yuan, marking the highest level in over 3 decades. This follows the government's coordinated efforts to counter rising US tariffs and declining domestic consumption. Despite multiple challenges, China has set an ambitious 5 per cent growth target for 2025.</p>
<p>Li Qiang, Chinese Premier, said in an address, &lsquo;The expected economic growth target of around 5 per cent is set not only to support employment stability, risk prevention, and public well-being but also because it is backed by economic growth potential and favorable conditions.&rsquo;&nbsp;</p>
<h2>Can more money mean less problems for China?</h2>
<p>China is ramping up fiscal spending to achieve its growth target, with the government pledging significant stimulus efforts to stabilise the economy. As part of its fiscal strategy, China will issue 1.3 trillion yuan in ultra-long sovereign bonds, marking an increase from last year's 1 trillion yuan. Additionally, 300 billion yuan will find a new trade-in programme, designed to boost consumer spending on durable goods like cars and appliances. The government is also allocating money for local governments. These measures are part of a broader effort to support a troubled domestic economy.</p>
<p>Li Qiang highlighted the focus points for 2025. 'The main targets for development this year are projected as follows: GDP growth of around 5 per cent, surveyed urban unemployment rate of around 5.5 per cent, over 12 million new urban jobs, CPI increase of around 2 per cent,' he said.</p>
<p>While local government debt is estimated to be as high as 100 per cent of GDP, central borrowing has increased in recent years to manage growing debt risks at local levels. Despite concerns over long-term inflation and debt servicing, China believes borrowing and injecting more money into the economy can possibly offset rising concerns over trade turmoil.</p>

Business & Economy, The government is also allocating money for local governments. These measures are part of a broader effort to support a troubled domestic economy.

China has set its fiscal deficit target for 2025 at a record 5.66 trillion yuan, marking the highest level in over 3 decades. This follows the government's coordinated efforts to counter rising US tariffs and declining domestic consumption. Despite multiple challenges, China has set an ambitious 5 per cent growth target for 2025. Li Qiang, Chinese Premier, said in an address, ‘The expected economic growth target of around 5 per cent is set not only to support employment stability, risk prevention, and public well-being but also because it is backed by economic growth potential and favorable conditions.’ Can more money mean less problems for China? China is ramping up fiscal spending to achieve its growth target, with the government pledging significant stimulus efforts to stabilise the economy. As part of its fiscal strategy, China will issue 1.3 trillion yuan in ultra-long sovereign bonds, marking an increase from last year's 1 trillion yuan. Additionally, 300 billion yuan will find a new trade-in programme, designed to boost consumer spending on durable goods like cars and appliances. The government is also allocating money for local governments. These measures are part of a broader effort to support a troubled domestic economy. Li Qiang highlighted the focus points for 2025. 'The main targets for development this year are projected as follows: GDP growth of around 5 per cent, surveyed urban unemployment rate of around 5.5 per cent, over 12 million new urban jobs, CPI increase of around 2 per cent,' he said. While local government debt is estimated to be as high as 100 per cent of GDP, central borrowing has increased in recent years to manage growing debt risks at local levels. Despite concerns over long-term inflation and debt servicing, China believes borrowing and injecting more money into the economy can possibly offset rising concerns over trade turmoil.

China’s economic vision for 2025 meets Trump’s tariffs

Preparations for the Chinese Lunar New Year are coming to a close as China and several communities prepare to celebrate the Year of the Snake.

China gears up for prosperous Year of the Snake

<p>In their preparation for what may be a trade battle with the United States, Chinese officials are moving away from decades of tradition.&nbsp;The Chinese government is appealing to its people to help get the world's second-biggest economy out of its slump.</p>
<p>Previously, the government has ridden out economic downturns by increasing investment in infrastructure, manufacturing, and inexpensive loans.&nbsp;That does not look viable now. There are currently more houses, roads, and trains in many regions of China than are necessary.</p>
<p>And in a globe leaning towards protectionism, it's unclear who would purchase China&rsquo;s goods even if its manufacturers produced more of them.</p>
<h2><strong>Will the Chinese finally start spending?</strong></h2>
<p>Analysts say increasing domestic spending is the most obvious strategy to bolster growth and stall a spike in unemployment.&nbsp;However, the question of how to entice the country's 900 million working-age residents remains unanswered.</p>
<p>A country used to steadily rising living standards was taken aback by the aggressive pandemic restrictions that stalled the economy for nearly three years.&nbsp;Millions of Chinese have seen their wealth erode due to the prolonged property crisis. Now, a majority view their job stability and future prospects with a sense of pessimism.</p>
<p>In 2024, a series of stimulus programs proved ineffective because households continued to save for potential economic downturns.&nbsp;More importantly, it is not clear if President Xi Jinping is prepared to take all necessary steps to usher in a new age of domestic demand-driven growth.</p>
<p>The previous two decades have seen a meteoric rise in incomes, with GDP per capita increasing by a factor of 10.&nbsp;But the Chinese have a long history of saving a significant portion of their income &mdash; about a third &mdash; every year.</p>
<p>Household spending at roughly 45 per cent of GDP falls short of 60 per cent to 80 per cent in the majority of OECD nations.&nbsp;The main reason is that China's social benefits for households are weak. Cash and other benefits are lower than in other major economies.</p>
<p>Could China revive household demand by incentivising citizens? That will answer China's growth dynamics in a world leaning towards protectionism.</p>
<p><em>(With inputs from the agencies)</em></p>

Business & Economy: Analysts say increasing domestic spending is the most obvious strategy to bolster growth and stall a spike in unemployment. 

In their preparation for what may be a trade battle with the United States, Chinese officials are moving away from decades of tradition. The Chinese government is appealing to its people to help get the world's second-biggest economy out of its slump. Previously, the government has ridden out economic downturns by increasing investment in infrastructure, manufacturing, and inexpensive loans. That does not look viable now. There are currently more houses, roads, and trains in many regions of China than are necessary. And in a globe leaning towards protectionism, it's unclear who would purchase China’s goods even if its manufacturers produced more of them. Will the Chinese finally start spending? Analysts say increasing domestic spending is the most obvious strategy to bolster growth and stall a spike in unemployment. However, the question of how to entice the country's 900 million working-age residents remains unanswered. A country used to steadily rising living standards was taken aback by the aggressive pandemic restrictions that stalled the economy for nearly three years. Millions of Chinese have seen their wealth erode due to the prolonged property crisis. Now, a majority view their job stability and future prospects with a sense of pessimism. In 2024, a series of stimulus programs proved ineffective because households continued to save for potential economic downturns. More importantly, it is not clear if President Xi Jinping is prepared to take all necessary steps to usher in a new age of domestic demand-driven growth. The previous two decades have seen a meteoric rise in incomes, with GDP per capita increasing by a factor of 10. But the Chinese have a long history of saving a significant portion of their income — about a third — every year. Household spending at roughly 45 per cent of GDP falls short of 60 per cent to 80 per cent in the majority of OECD nations. The main reason is that China's social benefits for households are weak. Cash and other benefits are lower than in other major economies. Could China revive household demand by incentivising citizens? That will answer China's growth dynamics in a world leaning towards protectionism. (With inputs from the agencies)

China faces challenge: Can domestic spending revive its slumping economy?

Millions of Chinese travellers are making their way home for the Lunar New Year celebrations and starting the spring festival with travel. Watch this report for more details!

Lunar new year travellers in China face economic uncertainty

<p>Suppose the weakening Chinese economy, rising dollar, and possibility of greater US Tariffs weren't bad enough. In that case, the yuan is now facing an extra downdraft: an influx of capital seeking to invest abroad.</p>
<p>Last year, investors in China sought greater profits elsewhere, leading to a record outflow of wealth.</p>
<p>Government data show that this led to banks' client payments for capital and financial transactions exceeding those for the current account, which mostly concerns trade. That's unprecedented.</p>
<p>Any further widening of that imbalance is likely to be accompanied by concerns about massive outflows of money, which would undermine Beijing's yuan management and heighten the likelihood of a regulatory crackdown.</p>
<p>The yuan has fallen around 2.8 per cent in the last three months, following the footsteps of all Asian currencies.</p>
<p>This is driven by the dollar's gain following Donald Trump's presidential victory on November 5.</p>
<h2><strong>Chinese yuan faces more downdraft</strong></h2>
<p>The value of the Chinese yuan fell this month again, marking its lowest point since September 2023.</p>
<p>Bloomberg estimates that local banks in China transferred a record-breaking 1.33 trillion yuan or 182 billion dollars to offshore investment accounts last year.</p>
<p>The fall in foreign direct investment flows, the eagerness of local enterprises to grow overseas, and the flight of capital from local equities have all put pressure on the nation's capital account.</p>
<p>These variables, taken together, have resulted in a rise in dollar demand, more outflows, and more yuan volatility.</p>
<p><em>(With the inputs from the agencies)</em></p>

Business & Economy: The yuan has fallen around 2.8 per cent in the last three months, following the footsteps of all Asian currencies. The value of the yuan fell this month again.

Suppose the weakening Chinese economy, rising dollar, and possibility of greater US Tariffs weren't bad enough. In that case, the yuan is now facing an extra downdraft: an influx of capital seeking to invest abroad. Last year, investors in China sought greater profits elsewhere, leading to a record outflow of wealth. Government data show that this led to banks' client payments for capital and financial transactions exceeding those for the current account, which mostly concerns trade. That's unprecedented. Any further widening of that imbalance is likely to be accompanied by concerns about massive outflows of money, which would undermine Beijing's yuan management and heighten the likelihood of a regulatory crackdown. The yuan has fallen around 2.8 per cent in the last three months, following the footsteps of all Asian currencies. This is driven by the dollar's gain following Donald Trump's presidential victory on November 5. Chinese yuan faces more downdraft The value of the Chinese yuan fell this month again, marking its lowest point since September 2023. Bloomberg estimates that local banks in China transferred a record-breaking 1.33 trillion yuan or 182 billion dollars to offshore investment accounts last year. The fall in foreign direct investment flows, the eagerness of local enterprises to grow overseas, and the flight of capital from local equities have all put pressure on the nation's capital account. These variables, taken together, have resulted in a rise in dollar demand, more outflows, and more yuan volatility. (With the inputs from the agencies)

China's record capital outflows pile pressure on yuan

China's economy grew by 5% in 2024, according to official data. While this was slightly above the forecasted 4.9%, it marked the slowest growth in decades, excluding the pandemic years.

China grapples with slow growth

<p><span class="region">New Delhi</span>
<p>After a conference of senior officials urged for additional stimulus, China's authorities promised to implement more effective fiscal policies and increase efforts to stabilise the housing and equities markets. </p></p>
<p>Regulating the supply of land for new construction are two steps the government will take to boost the recovery of the property market. This is according to China news service, citing Dong Jianguo, a Deputy Minister at the Housing Ministry. </p>
<p>The China Securities Regulatory Commission announced plans to increase oversight of derivatives, quantitative trading, margin trading, and spot and futures prices. According to the ministry of finance, more effective and long-lasting fiscal policies and better macroeconomic rules will be put in place next year. </p>
<p>In addition, the government would extend the investment regions for local government special bonds and boost their issuance and consumption. The announcements follow a two-day meeting of the Central Economic Work Conference in Beijing. </p>
<p>Officials led by President Xi Jinping pledged to increase the fiscal deficit target for next year. Stimulating total domestic demand and "lifting consumption vigorously" were their top priorities for the second time in at least a decade. </p>
<p>Signs of recovery in consumption and industry activity have helped China's faltering economy recover somewhat in recent weeks. That is thanks to increased government backing. Since policies haven't been robust enough to rescue the economy from deflation, confidence broadly is still low. </p>


The China Securities Regulatory Commission announced plans to increase oversight of derivatives, quantitative trading, margin trading, and spot and futures prices. According to the ministry of finance, more effective and long-lasting fiscal policies and better macroeconomic rules will be put in place next year. 



New Delhi After a conference of senior officials urged for additional stimulus, China's authorities promised to implement more effective fiscal policies and increase efforts to stabilise the housing and equities markets. Regulating the supply of land for new construction are two steps the government will take to boost the recovery of the property market. This is according to China news service, citing Dong Jianguo, a Deputy Minister at the Housing Ministry. The China Securities Regulatory Commission announced plans to increase oversight of derivatives, quantitative trading, margin trading, and spot and futures prices. According to the ministry of finance, more effective and long-lasting fiscal policies and better macroeconomic rules will be put in place next year. In addition, the government would extend the investment regions for local government special bonds and boost their issuance and consumption. The announcements follow a two-day meeting of the Central Economic Work Conference in Beijing. Officials led by President Xi Jinping pledged to increase the fiscal deficit target for next year. Stimulating total domestic demand and "lifting consumption vigorously" were their top priorities for the second time in at least a decade. Signs of recovery in consumption and industry activity have helped China's faltering economy recover somewhat in recent weeks. That is thanks to increased government backing. Since policies haven't been robust enough to rescue the economy from deflation, confidence broadly is still low.

China's regulators vow to stabilise property, stock markets

<p>After a conference of senior officials urged for additional stimulus, China's authorities promised to implement more effective fiscal policies and increase efforts to stabilise the housing and equities markets.&nbsp;</p>

<p>Regulating the supply of land for new construction are two steps the government will take to boost the recovery of the property market. This is according to China news service, citing Dong Jianguo, a Deputy Minister at the Housing Ministry.&nbsp;</p>

<p>The China Securities Regulatory Commission announced plans to increase oversight of derivatives, quantitative trading, margin trading, and spot and futures prices. According to the ministry of finance, more effective and long-lasting fiscal policies and better macroeconomic rules will be put in place next year.&nbsp;</p>

<p>In addition, the government would extend the investment regions for local government special bonds and boost their issuance and consumption. The announcements follow a two-day meeting of the Central Economic Work Conference in Beijing.&nbsp;</p>

<p>Officials led by President Xi Jinping pledged to increase the fiscal deficit target for next year. Stimulating total domestic demand and "lifting consumption vigorously" were their top priorities for the second time in at least a decade.&nbsp;</p>

<p>Signs of recovery in consumption and industry activity have helped China's faltering economy recover somewhat in recent weeks. That is thanks to increased government backing. Since policies haven't been robust enough to rescue the economy from deflation, confidence broadly is still low.&nbsp;</p>


After a conference of senior officials urged for additional stimulus, China's authorities promised to implement more effective fiscal policies and increase efforts to stabilise the housing and equities markets.

After a conference of senior officials urged for additional stimulus, China's authorities promised to implement more effective fiscal policies and increase efforts to stabilise the housing and equities markets. Regulating the supply of land for new construction are two steps the government will take to boost the recovery of the property market. This is according to China news service, citing Dong Jianguo, a Deputy Minister at the Housing Ministry. The China Securities Regulatory Commission announced plans to increase oversight of derivatives, quantitative trading, margin trading, and spot and futures prices. According to the ministry of finance, more effective and long-lasting fiscal policies and better macroeconomic rules will be put in place next year. In addition, the government would extend the investment regions for local government special bonds and boost their issuance and consumption. The announcements follow a two-day meeting of the Central Economic Work Conference in Beijing. Officials led by President Xi Jinping pledged to increase the fiscal deficit target for next year. Stimulating total domestic demand and "lifting consumption vigorously" were their top priorities for the second time in at least a decade. Signs of recovery in consumption and industry activity have helped China's faltering economy recover somewhat in recent weeks. That is thanks to increased government backing. Since policies haven't been robust enough to rescue the economy from deflation, confidence broadly is still low.

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