### Summary
Consumption and other economic indicators are showing signs of recovery in Vietnam, although it will be a gradual process.
### Facts
- 💸 Spending is increasing and there are more transactions, indicating an economic recovery is on the horizon.
- 📉 Credit interest rates are declining, which may further boost economic growth.
- 📈 Retail sales grew by 7.1% year-on-year, indicating steady growth.
- ✈️ International tourists are returning, with over one million arrivals in July.
- 🌍 Vietnam's growth is projected to be 4.7% this year, 5.5% next year, and 6% in 2025, according to the World Bank.
- 🛍️ Taking advantage of free trade agreements and implementing financial sector reforms can help increase exports and reduce risks.
### Summary
The Chinese economy has slipped into deflationary mode, with retail sales, industrial production, and exports all missing forecasts. Shrinking domestic demand and a debt-fueled housing crisis are the main causes behind this slowdown.
### Facts
- 📉 Retail sales in July grew by 2.5% year-on-year, compared to 3.1% in June.
- 🏭 Value-added industrial output expanded by 3.7% y-o-y, slowing from 4.4% growth in June.
- 📉 China's exports fell by 14.5% in July compared to the previous year, and imports dropped 12.4%.
- 💼 Overall unemployment rate rose to 5.3% in July, with youth unemployment at a record 21.3% in June.
- 📉 Consumer Price Index-based inflation dropped to (-)0.3%, indicating a deflationary situation.
- 🏢 China's debt is estimated at 282% of GDP, higher than that of the US.
### Causes of the slowdown
- The debt-fueled housing sector collapse, which contributes to 30% of China's GDP.
- Stringent zero-Covid strategy and lockdown measures that stifled the domestic economy and disrupted global supply chains.
- Geopolitical tensions and crackdowns on the tech sector, resulting in revenue losses and job cuts.
### Reaction of global markets
- The S&P 500 fell 1.2% following the grim Chinese data.
- US Treasury Secretary warns China's slowing economy is a risk factor for the US economy.
- Japanese stocks and the Indian Nifty were also impacted.
- China's central bank cut its benchmark lending rate, but investors were hoping for more significant stimulus measures.
### Global market concerns
- China's struggle to achieve the 5% growth target may impact global demand.
- China is the world's largest manufacturing economy and consumer of key commodities.
- A slowdown in China could affect global growth, with the IMF's forecast of 35% growth contribution by China seeming unlikely.
### Impact on India
- India's aim to compete with China in the global supply chain could benefit if Chinese exports decline.
- However, if China cuts back on commodity production due to slowing domestic demand, it may push commodity prices higher.
### Summary
China's fiscal revenue rose 11.5% in the first seven months of 2023, but at a slower pace than the previous six months, indicating a loss of economic momentum.
### Facts
- 💰 China's fiscal revenue increased by 11.5% in the first seven months of 2023.
- 💸 Fiscal expenditure grew by 3.3% to 15.2 trillion yuan ($2.10 trillion).
- 📉 In July, fiscal revenue only rose 1.9% year on year, slower than the previous month's increase.
- 📉 Fiscal expenditure fell 0.8% in July, narrowing the decline compared to the previous month.
- 🌍 China's economy grew at a sluggish pace in the second quarter due to weak demand domestically and internationally.
- 📉 The consumer sector in China experienced deflation in July, with analysts predicting persisting price stagnation for the next six to 12 months.
China is facing a severe economic downturn, with record youth unemployment, a slumping housing market, stagnant spending, and deflation, which has led to a sense of despair and reluctance to spend among consumers and business owners, potentially fueling a dangerous cycle.
China's economy, which has been a model of growth for the past 40 years, is facing deep distress and its long era of rapid economic expansion may be coming to an end, marked by slow growth, unfavorable demographics, and a growing divide with the US and its allies, according to the Wall Street Journal.
China's President Xi Jinping reassured the BRICS group that China's economy is resilient and its long-term growth remains unchanged, despite challenges such as a property slump and weak consumer spending.
China faces challenges in rebalancing its economy towards increased consumer spending due to the economic growth model that relies heavily on investment in property, infrastructure, and industry, as well as the reluctance of households to spend and the limited social safety net; implementing demand-side measures would require difficult decisions and potential short-term pain for businesses and the government sector.
US consumer spending is showing resilience and robust growth, although signs of a slowdown are emerging, potentially related to the public's perception of a deteriorating financial situation due to high inflation and rising interest rates, despite the fact that households still have higher deposits compared to pre-pandemic levels.
China's economic model, driven by industrialization and exports, is showing weaknesses with an imbalanced economy, low demand, slumping trade, and a struggling property sector, highlighting the need for structural reforms to boost domestic consumption and confidence.
China's economy is struggling due to an imbalance between investments and consumption, resulting in increased debt and limited household spending, and without a shift towards consumption and increased policy measures, the economic slowdown may have profound consequences for China and the world.
China's rebound from zero-covid restrictions has resulted in weak growth and deflation, with the lack of consumer spending becoming a major concern for policymakers.
Consumer spending in China rebounded in August, with all categories, including apparel, automotive, food, furniture, appliances, and luxury, experiencing increased sales compared to July, according to a survey by the China Beige Book. Retail sales in July rose by 2.5% year-on-year, raising concerns about China's economic growth, but the August survey showed a surge in spending, particularly in the services sector, which saw continued strength in travel and hospitality. Additionally, corporate borrowing increased as the cost of capital declined, indicating a boost in business activity. However, China's property sector continued to worsen, with house prices barely growing and home sales declining.
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.
China's failure to restructure its economy according to President Xi Jinping's bold reform plans has raised concerns about the country's future, with the possibility of a financial or economic crisis looming and a slow drift towards stagnation being the most likely outcome. The three potential paths for China include a swift, painful crisis; a gradual winding down of excesses at the expense of growth; or a switch to a consumer-led model with structural reforms that bring short-term pain but lead to a faster and stronger emergence.
China's trade and inflation data for the week are expected to show a fragile economic recovery, leading policymakers to consider further stimulus measures, although the effects of recent policy measures may take some time to be reflected in the data.
China's economic boom, once seen as a miracle, now appears to be a mirage due to failed reforms, an outdated reliance on old economic models, and a growing debt burden, raising concerns about the nation's economic future and the potential for a financial crisis.
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 imports and exports experienced a monthly decline in August, with exports falling by 8.8% and imports falling by 7.3%, indicating ongoing challenges despite some slight improvement.
China's total import and export value in the first 8 months of this year slightly decreased by 0.1 percent compared to the previous year, but exports have continued to grow and the global market share remains stable, highlighting the overall stability of China's foreign trade operations.
China's consumer price index rebounded in August after slipping into deflation in July, indicating a post-Covid economic recovery, despite sluggish domestic consumption and concerns of a relapse into deflation in the coming months.
China's consumer prices returned to positive territory in August as deflation pressures ease, but analysts warn that more policy support is needed to boost consumer demand in the economy.
China's consumer prices returned to positive territory in August, increasing by 0.1% from a year earlier, while producer prices fell for the 11th consecutive month; analysts expect consumer prices to recover and services inflation to pick up as energy prices stabilize and the output gap narrows.
China's foreign ministry rejects claims from the West that its economy is faltering, stating that the country's economy is resilient and has not collapsed.
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.
Chinese economic data showed signs of improvement in August, with retail sales and industrial production exceeding expectations, and key commodities experiencing growth, although challenges remain in the property market.
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.
The article discusses the current state of the economy and questions whether the "soft landing" explanation and belief in a full recovery are accurate, particularly in light of China's economic struggles and global inflation concerns.
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.
China's economic woes may not be catastrophic as its policymakers and the country's vast resources, coupled with its massive economy and global interconnectedness, offer potential for recovery despite mounting financial and geopolitical pressures.
Chinese officials express confidence in the country's economic outlook, despite projections of weakness by institutions such as the Asian Development Bank and the Organization for Economic Cooperation and Development, citing improved factory output and tourism figures as signs of recovery.
China is facing challenges in its economic recovery, including calls for policy clarity, concerns over over-reliance on Chinese EVs, inadequate scientific literacy, declining luxury spending by the middle class, and a shrinking US middle class.
Profits at China's industrial firms decreased by 11.7% in the first eight months of the year, but the pace of decline eased slightly, suggesting a modest recovery is taking place due to policy support measures.
Consumer spending remains resilient despite inflation and rising prices, contributing to economic growth, while the risk of a recession in the US has decreased but not disappeared completely.
China's small economic rebound appears to have stalled in September, with weak retail sales, manufacturing production, and loan growth, raising concerns about anemic third-quarter growth and the country falling short of its growth target.
China's economy is showing signs of a stronger recovery, with indicators such as increased activity around shopping malls, a pickup in cement manufacturing, and a surge in traffic congestion, suggesting renewed consumer confidence and a positive direction for the construction sector.
China's trade slump is gradually easing as September's exports fell less than expected, indicating a potential bottoming-out of global trade; however, uncertainties in the property sector and weak confidence among private firms continue to pose risks to the country's economic recovery.
China's exports decline improved modestly in September, with the pace slower than the previous month, while imports remained largely unchanged, and analysts anticipate more support will be needed as external demand is expected to stay weak.
China's exports and imports declined at a slower pace in September, indicating a gradual stabilization in the economy, although challenges remain in the face of deflationary pressure, a property crisis, global slowdown, and geopolitical tensions.
Chinese copper markets show signs of recovery from the second quarter slump as clean concentrate spot TCs decline due to increased demand for cargoes and cathode import interest improves on tighter spot supplies.
China's imports of major commodities, including crude oil, natural gas, coal, and iron ore, remained resilient in September, showing strong growth compared to the same period last year, defying the market narrative that the country's economy is struggling for momentum.
China's economy has regained momentum in the third quarter, with GDP expanding by 4.9% from a year ago, putting Beijing's annual growth target of around 5% within reach, although challenges such as the real estate sector and an aging population remain.
China's economy grew at a faster pace than expected in Q3, with GDP increasing by 4.9% year-on-year, indicating that recent stimulus measures are starting to have a positive impact on the country's recovery.
China's economy shows signs of recovery despite slipping stocks of big Chinese firms traded in the US.
China's economy grew at 4.9% but the real estate crisis and high government debt levels continue to dampen growth, raising concerns about the country's economic recovery.
