Home prices decline across all Chinese city tiers; China Development Bank official expelled from party

2202

A round-up of the top economic and financial headlines in the Chinese press as of 17 November, 2023.

Residential home prices decline across all Chinese municipal tiers in October (National Bureau of Statistics

In October, the sales price of newly built commercial housing in first-tier cities dropped by 0.3% from the previous month, with Beijing, Guangzhou and Shenzhen falling by 0.4%, 0.7% and 0.5% respectively, and Shanghai rising by 0.2%.

Pre-owned housing prices saw a shift from an increase of 0.2% the previous month to a decrease of 0.8% in October, with Beijing, Shanghai, Guangzhou and Shenzhen decreasing by 1.1%, 0.8%, 0.8% and 0.5% respectively.

The sales price of newly built commercial housing in second-tier cities fell by 0.2% month-on-month, for a decline 0.1 percentage points narrower than last month.

The sales price of pre-owned housing fell by 0.5% month-on-month, for a decline on par with last month. 

The sales prices of newly built commercial housing and pre-owned housing in third-tier cities fell by 0.5% and 0.6% respectively month-on-month, for decline increases of 0.2 and 0.1 percentage points respectively compared to the previous month.

Net injections by Chinese central bank via medium-term lending facilities hit record high of 600 billion yuan (Securities Journal

On 15 November, the People’s Bank of China (PBOC) undertook 495 billion yuan in open market reverse repo operations and 1.45 trillion yuan in medium-term lending facility (MLF) operations. 

On that day, 474 billion yuan of reverse repo and 850 billion yuan of MLF expired. Consequently, PBOC made net injections of 21 billion yuan through reverse repos and net injections of 600 billion yuan via MLF. The scale of net MLF injections hit a seven-year high.

The 7-day reverse repo rate and MLF interest rate remained unchanged at 1.8% and 2.5% respectively.

PBOC’s above-parity renewal of MLF is in line with market expectations and will help alleviate liquidity pressure in the banking system.

Experts believe that we are currently at a critical stage of promoting the continued momentum of economic recovery, and it is necessary to maintain reasonable and sufficient market liquidity, curb the excessive upward trend of market interest rates, and actively respond to the disturbance of liquidity caused by the issuance of local government bonds and government bonds. 

Multiple economic indicators accelerate recovery in October, policy effects will help consolidate macro-economy (Shanghai Securities Journal)

Data released by the National Bureau of Statistics on 15 November indicates that the year-on-year growth rate of many indices such as industry, the services sector and consumption saw a rebound in October from September, and overall economic performance has continued to recover. 

In the analysis of experts, the effect of a combination of macro-control policies will become further apparent. Given that base figures for last year were relatively low, the year-on-year growth rate of economic indicators in the fourth quarter of this year are expected to increase.

In October, the added value of industrial companies above designated size increased by 4.6% year-on-year, for a growth rate 0.1 percentage points faster than in September.

In October, total retail sales of consumer goods increased by 7.6% year-on-year, 2.1 percentage points faster than in September, pointing to a hastening recovery.

“It is worth mentioning that in October, the year-on-year growth rate of home appliances, furniture, construction and decoration materials and other real estate-related consumption rebounded, with retail sales of home appliances and furniture achieving positive growth year-on-year.” said Wang Qing (王青), chief macro-analyst at Golden Credit Rating. 

National budget revenue up 8.1% YoY for Jan – Oct (People’s Daily

Data released by the Ministry of Finance on 15 November indicates that from January to October, the national general public budget revenue totalled 18.7494 trillion yuan, for a year-on-year increase of 8.1%. 

Tax revenue was 15.7841 trillion yuan, for a year-on-year increase of 10.7%; and non-tax revenue was 2.9653 trillion yuan, for a year-on-year decrease of 3.8%. 

Looking at central and local governments, the central general public budget revenue was 8.587 trillion yuan, for a year-on-year increase of 7.3%, and the local general public budget revenue was 10.1624 trillion yuan, for a year-on-year increase of 8.8%.

Vice-president of China Development Bank expelled from Communist Party (People’s Daily)

The Central Commission for Discipline Inspection and the State Supervisory Commission have launched a case review and investigation into Zhou Qingyu (周清玉), former party committee member and vice-president of the China Development Bank (CDB), for serious violations of discipline and law.

Investigation has found that Zhou Qingyu lost his ideals and beliefs, deviated from party principles, abandoned his responsibility to supervise the party strictly and comprehensively, abused his authority to supervise and discipline, engaged in superstitious activities, privately collected and read books and periodicals with serious political issues, and ignored the eight regulations of the Central Committee.

He accepted invitations to banquets arranged by private business owners, entered and exited private clubs in violation of regulations, used his authority to seek profits for others and engaged in lewd power and money transactions. 

National Development and Reform Commission reveals “spoilers” on series of measures to stabilise economic growth (Shanghai Securities Journal

The National Development and Reform Commission (NDRC) held a press conference on 16 November with “spoilers” on a series of policy themes, including expanding domestic demand, developing and strengthening the private economy, and promoting the introduction of more comprehensive policies and measures to attract foreign investment.

Li Chao (李超), deputy director and spokesperson of the NDRC Policy Research Office, said that the Private Economic Development Bureau has carried out research on major issues for optimizing the development environment for the private economy in the upcoming period, researching and introducing policies and measures to promote the private economy to enhance international competitiveness and strengthen brand building.

Li said that China welcomes investors from all over the world to invest and start businesses in China, and will continue to provide a good investment environment and necessary conveniences for foreign-invested enterprises to do business in China, as well as will launch further investment policies.

“On the basis of existing policies, we will accelerate the introduction of comprehensive policies and measures to attract greater foreign investment, improve the level of liberalization of foreign investment, smooth the flow of innovation factors, and promote pragmatic cooperation between domestic and foreign-invested enterprises,” Li said.

About China Banking News

First established in 2017, China Banking News (www.chinabankingnews.com) is a premium provider of news and intelligence on Chinese economic and financial policy for an English-speaking audience. 

In addition to syndicated briefings and reports, China Banking News is also available for bespoke research and commissioned reports. 

We welcome any feedback, recommendations or advice with regard to the contents and quality of our research reports. 

Please contact us at editor@chinabankingnews.com

© Copyright 2023 CBAN Media. All Rights Reserved

China Banking News endeavours to ensure the information provided in this publication is accurate and up-to-date. No legal liability can be attached as to the contents hereof. This report is intended for general guidance and information purposes only. This report is under no circumstances intended to be used or considered as financial or investment advice.