A round-up of China’s financial and economic headline news stories from the week of 15 – 19 May 2023.
CSRC guides stock exchanges to revise and release guidelines, strengthen information disclosure, and speed up the pace of REIT issuance and listing
“The China Securities Regulatory Commission (CSRC) announced on May 12 that it had given guidance to stock exchanges to revise the guidelines for REIT audit matter, highlighting the ‘management of assets’ as the core, further optimizing REITs audit matters, strengthening information disclosure requirements, and providing clarification on the two key areas of industrial parks and toll roads.
“[CSRC] also called for improving the review and information disclosure standards of similar assets, improving the transparency of recommended review of mature types of assets, accelerating the pace of issuance and listing, and promoting the high-quality development of the REITs market.”
Original source: 证监会指导证券交易所修订发布指引 强化信披 加快REITs发行上市节奏.
Household deposits decrease by 1.2 trillion yuan – experts can’t rule out shift to wealth management products
“The sharp decrease in renminbi deposits in April has triggered market concerns. On May 11, the latest data released by the People’s Bank of China indicated that renminbi deposits decreased by 460.9 billion yuan in April, an expansion of 552.4 billion yuan in year-on-year terms. This included a decrease in household deposits of 1.2 trillion yuan.
“Wang Qing, chief macro analyst at Golden Credit Rating, said to Securities Daily that the end-of-quarter assessment of banks in April had passed. Based on seasonal factors, it can’t be ruled out that household deposits that month had been impacted by a shift towards wealth management products.”
Original source: 住户存款减少1.2万亿元 专家：不排除因居民存款向理财“搬家.
Multiple banks reduce rates on two types of deposits, diversification by investors becomes the general trend
“On 15 May, a number of banks reduced interest rates on agreed deposits and call deposits. A reporter from China Securities Journal visited a number of bank outlets and learned that after the two types of deposit interest rates were lowered, wealth management and insurance products became the key products recommended by bank account managers.
“Members of industry believe that in the context of lower deposit rates, investors should consider their own risk tolerance and liquidity needs when making investment and financial management and carry out diversified asset allocation”
Original source: 多家银行下调两类存款利率 投资者多元化配置大势所趋.
First quarter monetary policy execution report calls for continued loosening and protecting banks’ net interest margins
“On May 15, the central bank released the monetary policy execution report for the first quarter of 2023.
“The central bank judged that ‘triple pressures have been alleviated,’ but ‘endogenous strength is not strong, and demand is still insufficient.’ In the first quarter, China’s GDP grew by 4.5%, exceeding market expectations, partly due to the concentrated release of backlog demand.
“However, indicators such as PMI, total social financing, and real estate sales have fallen marginally since April, indicating that the economy’s endogenous strength is insufficient and its foundations are weak, and policy protection is still needed.
“Monetary policy should continue to be ‘precise and powerful’ and engage in ‘cross-cycle adjustment,’ while the phrase ‘no flooding’ has been deleted from the latest quarterly monetary policy report. We judge that the monetary policy base will continue to be loose overall, as it is still necessary to consolidate the momentum of recovery.”
Original source: 一季度货币政策执行报告点评：延续宽松，呵护银行净息差.
Ministry of Commerce: From January to April, China absorbed 499.46 billion yuan in foreign capital, for a year-on-year increase of 2.2%
“According to an announcement from the Ministry of Commerce on 17 May, from January to April 2023 actually used foreign capital in China was 499.46 billion yuan, for a year-on-year increase of 2.2%. This was equivalent to 73.5 billion US dollars, for a decrease of 3.3%.
“With regard to sectors, actually used foreign capital in the manufacturing industry was 130.05 billion yuan, for an increase of 4.1%. Actually used foreign capital in high-tech industries increased by 12.8%, of which the high-tech manufacturing industry increased by 37.1% and the high-tech service industry increased by 6%.
“With regard to place of origin, actual investment into China from France, the United Kingdom, Japan and South Korea increased by 567.3%, 323.7%, 68.1% and 30.7% respectively.
Original source: 商务部：1-4月全国吸收外资4994.6亿元人民币 同比增长2.2%.
The United Nations and the IMF raise China’s economic growth forecast
“On 16 May, the United Nations released its mid-year report, predicting that the global economy will grow by 2.3% in 2023, for an increase of 0.4 percentage points from the previous report released in January.
“With regard to China’s economic growth forecast, the report raised its prediction from 4.8% to 5.3%, for a sharp increase of 0.5 percentage points.”
Original source: 联合国和IMF上调中国经济增长预期.
National Development and Reform Commission flags comprehensive measures to unleash consumption potential
“Meng Wei, a spokesperson from the National Development and Reform Commission (NDRC), said at a regular press conference held on May 17 that restoring and expanding demand is the key to economic recovery and improvement at present, and is also the key direction for promoting the steady growth of the industrial economy.
“The NDRC will comprehensively implement policies to release consumption potential, create a high-quality consumption supply system, and continue to make efforts to stabilize and expand manufacturing investment.”
Original source: 发改委：综合施策释放消费潜力 持续发力稳定和扩大制造业投资.
The State Administration of Financial Regulation officially launched, replacing China Banking and Insurance Regulatory Commission
“On the morning of 18 May, the State Administration of Financial Regulation (SAFR) unveiled its plaque, marking its official launch.
“SAFR was initially established on 7 March in accordance with the State Council’s intitutional reform plan, replacing the China Banking and Insurance Regulatory Commission (CBIRC).
“As an institution directly under the State Council, SAFR will bear unified responsibility for the supervision of the financial industry aside from the securities sector; strengthen institutional supervision, conduct supervision, functional supervision, across-the-board supervision and ongoing supervision, and bear overall responsibility for the protection of the rights and interests of consumers.
“It will strengthen risk management and preventative measures, and investigate and deal with violations of laws and regulations.”
Original source: 国家金融监督管理总局今日正式揭牌.