China's real estate crisis, caused by a crackdown on risky behavior by home builders and a subsequent housing slowdown, is spreading to the broader economy, leading to sinking sales, disappearing jobs, and a decline in consumer confidence, business investment, and stock markets.
China property-market pessimists are overlooking the underlying demand, as evidenced by strong sales by state-backed property developers and rising rents, according to veteran economist Hong Hao of Grow Investment Group.
China's real estate market is experiencing a significant downturn, causing major developers to face massive losses and mounting debts, which is impacting the country's economy and global growth.
China's economy is facing a downward spiral due to a crisis in the debt-laden property sector, prompting seven city banks to reduce their growth forecasts for the country; concerns include falling into deflation, high unemployment rates, and the need for more proactive government support.
China's economic slump is worsening due to the prolonged property crisis, with missed payments on investment products by a major trust company and a fall in home prices adding to concerns.
Chinese authorities have introduced new measures to boost investor confidence in the stock market by reducing trading costs, relaxing rules on share buybacks, and considering extended trading hours and a cut in stamp duty, following recent declines in both the stock and bond markets. These declines have been influenced by China's deteriorating economic outlook, including deflation, weak consumer spending on manufactured goods, rising youth unemployment, and concerns over the property market.
China should continue to prioritize the principle of "houses are for living in, not for speculation" to prevent potential negative impacts on economic and social development, according to an editorial in the state-run Economic Daily, as the country faces a downturn in the property sector and potentially unwinding some curbs.
China's economic slowdown, marked by falling consumer prices, a deepening real estate crisis, and a slump in exports, has alarmed international leaders and investors, causing Hong Kong's Hang Seng Index to fall into a bear market and prompting major investment banks to downgrade their growth forecasts for China below 5%.
The risks of China's economic slowdown have not been factored into the markets yet, according to Insigneo Chief Investment Officer Ahmed Riesgo, who believes that the crisis of confidence in China's economy will soon become a major global risk.
China's economy is facing challenges with slowing growth, rising debt, tumbling stock markets, and a property sector crisis, and some analysts believe that heavy-handed government intervention and a lack of confidence are underlying causes that cannot be easily fixed. However, others argue that China's problems are solvable and that it remains a superpower despite its considerable problems.
China's unexpected economic slowdown, driven by excessive investment in the property sector and local government spending, is leading experts to question whether a collapse is imminent, although they believe a sudden collapse is unlikely due to China's controlled financial system; however, the slowdown will have implications for global growth and emerging markets, particularly if the U.S. enters a recession next year.
China's economic slowdown, coupled with a property market bust and local government debt crisis, is posing challenges to President Xi Jinping's goals of achieving economic growth and curbing inequality, potentially affecting the Communist Party's legitimacy and Xi's grip on power.
China's economic slowdown is worrisome for global markets as it is one of the largest buyers of commodities.
There are growing concerns that China's economic growth is slowing, and there are doubts about whether the Chinese government will provide significant stimulus to support its trading partners, including Australia, which heavily relies on China as its top trading partner. China's economic slowdown is attributed to various factors such as trade tensions, demographic changes, a property market slump, and the lack of cash support during COVID-19 restrictions. While some experts remain optimistic that the Chinese government will implement stimulus measures, market sentiment is becoming strained, and patience is wearing thin. The impact on Australia's economy and stock market could be severe, particularly affecting mining companies, banks, construction, tourism, education, and listed fund managers.
China's hybrid economic model, which combines state planning with market forces, is facing challenges as the country struggles with weak economic indicators, including high youth unemployment and falling prices, and the property market experiences financial distress due to government interventions and market dynamics; policymakers must implement short-term measures to boost market confidence, such as managing property-sector defaults and easing housing investment restrictions, while also undertaking long-term structural reforms to address moral hazards, promote fiscal responsibility, and protect private businesses and foreign investors.
China's economic slowdown is causing alarm across the world, as it is expected to have a negative impact on global economic growth, leading to reduced imports and trade, falling commodity prices, a deflationary effect on global goods prices, and a decline in tourism and luxury spending.
Chinese officials have implemented aggressive measures to address the lack of confidence in the struggling economy, but analysts believe that more stimulus is needed for a sustained market rally and to stabilize the property sector.
Many ordinary Chinese are experiencing a widespread economic slowdown characterized by pessimism and resignation, despite Beijing's attempts to downplay concerns and project a positive narrative.
China's property crisis, led by embattled property giants like Evergrande, is causing devastating consequences for small businesses and suppliers who are owed large sums of money, putting both market confidence and debt repayments at risk. The crisis has affected the entire industry and could worsen if immediate actions are not taken to prevent contagion and spillover fears. The Chinese government is urged to abandon restrictive measures on real estate credit, carry out bankruptcy proceedings for developers with capital-outflow problems, and stop intervening in the market to stabilize home prices. The outlook for Chinese developers is deteriorating, particularly for distressed developers, while state-owned developers have a stable outlook. The Chinese housing market is facing a severe crisis that is worse than Japan's market in the early 1990s, posing challenges in filling the gap in spending left by the collapsing housing market.
Chinese consumer spending has rebounded in certain sectors, but concerns persist over the property market and GDP growth falling below 5%, according to Shehzad Qazi, managing director of China Beige Book.
The global economy is expected to slow down due to persistently high inflation, higher interest rates, China's slowing growth, and financial system stresses, according to Moody's Investors Service, although there may be pockets of resilience in markets like India and Indonesia.
Chinese homebuyers remain skeptical about entering the property market despite the Beijing government's measures to revive the economy, including lower mortgage rates, due to concerns about the slowing economy and the deepening crisis in the debt-ridden property sector.
Investor sentiment on China weakens as new data reveals slowest expansion in services activity in eight months, dragging down markets and raising concerns about the country's economy.
China's economy is showing signs of slowing down, including a decrease in GDP growth rate, declining exports, deflationary consumer price index, high youth unemployment, a weakening yuan, and a decrease in new loans, which could have global implications.
China's economic slowdown is posing a significant challenge to President Xi Jinping's agenda, forcing him to make difficult choices and potentially relinquish some control over the economy. The slump in housing sales and the crackdown on private capital are among the factors contributing to the economic setbacks, prompting calls for change and a reevaluation of economic policies under Xi's highly centralized leadership. However, Xi seems reluctant to make major changes to his strategy, opting for a hands-off approach and avoiding a big rescue plan for distressed developers and local governments. The central government's control over taxes and the need to revamp the fiscal system further complicate the situation. Restoring government finances while reassuring private investors is a daunting task that requires strong leadership and potentially contentious policy changes. The upcoming Communist Party meetings will shed light on how Xi plans to restore confidence in his economic agenda, but some economists and former officials warn that time may be running out for China to embrace necessary reforms.
China is considering further easing measures in the property market and increasing fiscal support for infrastructure investment to boost economic growth in the fourth quarter, as sluggish demand remains a challenge.
China's economic growth has slowed but has not collapsed, and while there are concerns about financial risks and a potential property crisis, there are also bright spots such as the growth of the new energy and technology sectors that could boost the economy.
China's real estate sector is facing a split market, with sales picking up in larger cities while slowing down in smaller cities, but further policy support is expected to stabilize the finances of property developers and dispel financial panic in the next two months.
China's property shares are declining and tech shares are underperforming, leading to a slide in the Asian market, while the European market waits for monetary policy decisions from the ECB and the Bank of England.
China's economy is expected to grow less than previously anticipated due to struggles in the property market, leading economists to predict further downgrades and posing risks to both the domestic and global economy.
Chinese property stocks and Japanese government bonds set the tone for global markets as the Hang Seng property index dropped to a fresh September low before rebounding on news that Country Garden won creditor support to delay onshore bond payments, while the Bank of Japan's comments about potential stimulus exit in 2023 pushed the local bond market, and the week ahead is marked by important policy meetings by the Bank of England, the Federal Reserve, and the ECB.
Asian markets are expected to finish the week strong due to positive movements in the U.S. and Europe, although the release of economic data from China may dampen the mood, as it includes indicators such as house prices, fixed asset investment, and unemployment. The Chinese government is aiming to support the economy, but doubts remain about reaching the 5% GDP growth target and trade relations with the West continue to deteriorate. However, if investors continue with the bullish momentum from Thursday, these concerns may be temporarily set aside.
China's government is downplaying its economic crisis by promoting positive narratives, while social media campaigns and state-run newspapers attack Western media outlets for biased reporting; however, reports suggest that the property sector downturn is causing significant ramifications, and growth projections for China have been downgraded by major banks.
China's property sector continues to struggle with deepening falls in new home prices, property investment, and sales in August, despite recent support measures, adding pressure to the country's economy.
China's factory output and retail sales grew at a faster pace in August, but declining investment in the property sector poses a threat to the country's economic recovery.
Despite prevailing negativity regarding China's economy, alternative high-frequency data points, such as subway ridership and commodity prices, suggest that many parts of the economy are functioning well, although the real estate sector is still struggling.
Economic activity in China appears to improve in August as industrial production and retail sales show growth, however, the real estate sector continues to face challenges with property investment and sales declining, leading Moody's to downgrade its outlook for the sector.
China's housing crisis continues as thousands of building projects are halted or slowed, leading to defaults and restructuring, a loss of confidence in the market, and a decline in sales.
Signs of improvement in China's economy, such as improving credit demand and easing deflationary pressures, may not be enough to stabilize the economy due to bigger concerns of decreasing affordability, tight wages, and rising costs that have not been addressed. A comprehensive policy revamp may be necessary for China's economy to recover.
China's economic data for August shows a mixed picture, with retail sales and production on the rise, property investment declining, and the urban jobless rate ticking downward, leading experts to believe that while there may be modest improvements in growth, a strong recovery is still unlikely.
The outlook of U.S. companies on China's markets in the next five years has hit a record low due to factors such as political tensions, tariffs, slow Covid recovery, and issues in the real estate market; however, complete decoupling between the two economies is unlikely.
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