China’s Market News: More Debt, Lower Taxes: The Proactive Fiscal Policy
Thursday, Oct 20, 2016 10:27 am -07:00
by Renee Mu, Currency Analyst
This daily digest focuses on Yuan rates, major Chinese economic data, market sentiment, new developments in China’s foreign exchange policies, changes in financial market regulations, as well as market news typically available only in Chinese-language sources.
- China’s tax revenue dropped in September, the first time in 19 months.
- Local governments issued 12.86 billion yuan of bonds in 2015 and 2016.
- China’s processing trade faces challenges from both inside and outside.
Yuan Rates
- The PBOC strengthened the Yuan slightly against the U.S. Dollar on Thursday, by +15 pips to 6.7311. The offshore USD/CNH found support at 6.7386 and retraced above the level. The onshore Yuan dipped to new six-year low, with the USD/CNY hitting 6.7439.
Market News
Hexun News: Chinese leading online media of financial news.
- China’s tax revenue shrank -0.7% to 824.3 billion Yuan in September from a year ago, the first decline in 19 months, according to a report released by the Ministry of Finance on Wednesday. The Ministry stated that the intended tax reduction was mostly driven by the replacement of business taxes to a unified value-added tax (VAT) effective beginning on May 1st. Cutting tax burden on Chinese firms is one of the measures following the proactive fiscal policy. It is expected that the tax reduction through VAT will reach 500 billion Yuan this year.
- As of October 18th, local governments have sold nearly 2000 local government bonds worth 9.20 trillion Yuan in 2015 and 2016; 80% of the bonds were issued through debt-to-bond program that allows local government to refinance and pay back the old debt. Also, local governments have raised 3.66 trillion Yuan in sales of over 3700 city investment bonds. In specific, Jiangsu, Shandong, Zhejiang and Guangdong provinces, with the best economic performance, issued the largest amount of debt. As of October 18th, the total outstanding of local government bonds and city investment bonds is 16.25 trillion Yuan.
- The amount of QFII and RQFII accounts rose significantly in September, showing foreign investors’ increased interests in Chinese equities and other Yuan assets amid Yuan’s official entry to IMF’s SDR basket. The QFII program allows qualified foreign institutional investors to directly purchase eligible Chinese assets with foreign currencies; the RQFII program allows direct purchases of Chinese assets with the Chinese Yuan. According to Hexun News, the average of new accounts opened per month is below 20; a significant increase in these accounts may be a sign of a bull Chinese equity market in the coming months.
Data downloaded from Hexun News; chart prepared by Renee Mu.
China Finance Information: a finance online media administrated by Xinhua Agency.
- In Yuan terms, China’s processing trade dropped -7.0% in January to September on an annualized basis, while the total trade only fell -1.9% over the same span of time. On October 20th, the Deputy Director of China’s General Administration of Customs, Sun Yibiao, addressed on the issue and pointed out a couple of contributing factors: A) Weak global demand has dragged down China’s exports. B) Foreign high-tech manufacturing companies have moved some of their factories back home. C) Emerging economies in Southeast Asia have shown comparative advantages in labor and land costs and become alternative production bases of low value-added goods. In order to cope with the changing environment, Chinese manufacturing firms need to move up in the value chain through industrial upgrading, according to Mr. Sun.
- Clearstream, partnering with HSBC, becomes the first institution that enables customers of international central securities depository (ICSD) to access to China’s interbank bond market. Clearstream is one of the two European ICSD. According to its annual report, the aggregate average volume of securities held in itscustody was 13.3 trillion euro in 2015. HSBC commented that China’s bond market now ranks the third globally, with a volume of more than 53 trillion Yuan. The development of China’s bond market will help to promote Yuan’s role as a global currency.
Sina News: China’s most important online media source, similar to CNN in the US. They also own a Chinese version of Twitter, called Weibo, with around 200 million active usersmonthly.
- China has meet 80% of both steel and coal capacity reduction targets by the end of the third quarter, according to the Ministry of Industry and Information Technology. Also, the steel prices have increased by +30% in mid-October from the beginning of this year; the coal prices rose +50% over the same span of time.
https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/china_news/2016/10/20/Chinas-Market-News-More-Debt-Lower-Taxes-The-Proactive-Fiscal-Policy-.html?utm_source=AWeber&utm_medium=Mu&utm_campaign=em
Thursday, Oct 20, 2016 10:27 am -07:00
by Renee Mu, Currency Analyst
This daily digest focuses on Yuan rates, major Chinese economic data, market sentiment, new developments in China’s foreign exchange policies, changes in financial market regulations, as well as market news typically available only in Chinese-language sources.
- China’s tax revenue dropped in September, the first time in 19 months.
- Local governments issued 12.86 billion yuan of bonds in 2015 and 2016.
- China’s processing trade faces challenges from both inside and outside.
Yuan Rates
- The PBOC strengthened the Yuan slightly against the U.S. Dollar on Thursday, by +15 pips to 6.7311. The offshore USD/CNH found support at 6.7386 and retraced above the level. The onshore Yuan dipped to new six-year low, with the USD/CNY hitting 6.7439.
Market News
Hexun News: Chinese leading online media of financial news.
- China’s tax revenue shrank -0.7% to 824.3 billion Yuan in September from a year ago, the first decline in 19 months, according to a report released by the Ministry of Finance on Wednesday. The Ministry stated that the intended tax reduction was mostly driven by the replacement of business taxes to a unified value-added tax (VAT) effective beginning on May 1st. Cutting tax burden on Chinese firms is one of the measures following the proactive fiscal policy. It is expected that the tax reduction through VAT will reach 500 billion Yuan this year.
- As of October 18th, local governments have sold nearly 2000 local government bonds worth 9.20 trillion Yuan in 2015 and 2016; 80% of the bonds were issued through debt-to-bond program that allows local government to refinance and pay back the old debt. Also, local governments have raised 3.66 trillion Yuan in sales of over 3700 city investment bonds. In specific, Jiangsu, Shandong, Zhejiang and Guangdong provinces, with the best economic performance, issued the largest amount of debt. As of October 18th, the total outstanding of local government bonds and city investment bonds is 16.25 trillion Yuan.
- The amount of QFII and RQFII accounts rose significantly in September, showing foreign investors’ increased interests in Chinese equities and other Yuan assets amid Yuan’s official entry to IMF’s SDR basket. The QFII program allows qualified foreign institutional investors to directly purchase eligible Chinese assets with foreign currencies; the RQFII program allows direct purchases of Chinese assets with the Chinese Yuan. According to Hexun News, the average of new accounts opened per month is below 20; a significant increase in these accounts may be a sign of a bull Chinese equity market in the coming months.
Data downloaded from Hexun News; chart prepared by Renee Mu.
China Finance Information: a finance online media administrated by Xinhua Agency.
- In Yuan terms, China’s processing trade dropped -7.0% in January to September on an annualized basis, while the total trade only fell -1.9% over the same span of time. On October 20th, the Deputy Director of China’s General Administration of Customs, Sun Yibiao, addressed on the issue and pointed out a couple of contributing factors: A) Weak global demand has dragged down China’s exports. B) Foreign high-tech manufacturing companies have moved some of their factories back home. C) Emerging economies in Southeast Asia have shown comparative advantages in labor and land costs and become alternative production bases of low value-added goods. In order to cope with the changing environment, Chinese manufacturing firms need to move up in the value chain through industrial upgrading, according to Mr. Sun.
- Clearstream, partnering with HSBC, becomes the first institution that enables customers of international central securities depository (ICSD) to access to China’s interbank bond market. Clearstream is one of the two European ICSD. According to its annual report, the aggregate average volume of securities held in itscustody was 13.3 trillion euro in 2015. HSBC commented that China’s bond market now ranks the third globally, with a volume of more than 53 trillion Yuan. The development of China’s bond market will help to promote Yuan’s role as a global currency.
Sina News: China’s most important online media source, similar to CNN in the US. They also own a Chinese version of Twitter, called Weibo, with around 200 million active usersmonthly.
- China has meet 80% of both steel and coal capacity reduction targets by the end of the third quarter, according to the Ministry of Industry and Information Technology. Also, the steel prices have increased by +30% in mid-October from the beginning of this year; the coal prices rose +50% over the same span of time.
https://www.dailyfx.com/forex/fundamental/daily_briefing/daily_pieces/china_news/2016/10/20/Chinas-Market-News-More-Debt-Lower-Taxes-The-Proactive-Fiscal-Policy-.html?utm_source=AWeber&utm_medium=Mu&utm_campaign=em
Today at 7:23 am by Rocky
» Governor of Baghdad: 20 projects will be included during the current year in the city of Nahrawan
Today at 7:20 am by Rocky
» More than $242 million in central bank sales today
Today at 7:17 am by Rocky
» Advisor: Sudanese is determined to close the displacement file
Today at 7:14 am by Rocky
» Al-Sudani: The implementation of the 2023 budget witnessed a success that must be invested in
Today at 7:13 am by Rocky
» The Baghdad Council will decide on the nomination of the committees in the coming days
Today at 7:10 am by Rocky
» Al-Samarrai: The Sunni community is not in favor of removing American forces
Today at 7:08 am by Rocky
» A warning from Al-Rasheed to those wishing to apply for advances and loans
Today at 7:06 am by Rocky
» Azerbaijan expresses its desire to participate in the implementation of joint projects in the oil an
Today at 7:05 am by Rocky
» Fuel cards arouse citizens' discontent
Today at 7:03 am by Rocky
» utube 3/18/24 MM&C Iraqi Dinar-- IQD-- Dinar Update -100% Electronic - Real Effective Exchange Rat
Today at 5:21 am by Rocky
» utube MM&C 3/16/24 0:05 / 18:16 Iraq Federal Court Brings - Strength to Financial - Politic
Today at 5:18 am by Rocky
» MM&C 3/18/24 Sudanese Advisor: Iraq will leave government monetary dealing in mid-2024
Today at 5:17 am by Rocky
» A delegation from the Kurdistan government visits Baghdad to discuss the issue of localization of sa
Today at 5:11 am by Rocky
» Director of the Central Oil Company: We are keen to provide the appropriate investment environment
Today at 5:10 am by Rocky
» The Energy Parliament calls for reporting generators violating government pricing
Today at 5:08 am by Rocky
» A representative reveals the fate of the laws of “previous sessions”
Today at 5:07 am by Rocky
» Politician: Coordination holds the keys to resolving the “Parliament Presidency” conflict
Today at 5:05 am by Rocky
» Al-Sudani: Iraq wants to carry out its peaceful activity in the field of atomic energy
Today at 5:04 am by Rocky
» Including a minister and a parliamentarian... 38 arrest and recruitment orders were issued against t
Today at 5:02 am by Rocky
» Integrity: Citizens’ cooperation resulted in detecting inflation and returning state funds
Today at 5:01 am by Rocky
» Agriculture presents 97 projects to the Ministerial Council for the Economy
Today at 4:59 am by Rocky
» Al-Sudani: We succeeded in implementing the 2023 budget, and we must continue to complete economic p
Today at 4:58 am by Rocky
» Labor adopts new mechanisms to reduce the phenomenon of begging
Today at 4:57 am by Rocky
» Electronically.. directing the collection of fees tomorrow in an Iraqi governorate
Today at 4:56 am by Rocky
» Held in Brussels.. Iraq receives an official invitation to attend the Nuclear Energy Summit
Today at 4:55 am by Rocky
» Kurdistan has been paralyzed. There has been no liquidity in hand for 50 days, and the truth has bee
Today at 4:53 am by Rocky
» The dollar continues to decline against the Iraqi dinar on the stock exchange and exchange offices
Today at 4:52 am by Rocky
» The Minister of Oil reveals the reasons for Shell’s withdrawal from Nebras: It will be divided into
Today at 4:51 am by Rocky
» The Housing Fund advises loan applicants and launches a link for inquiries
Today at 4:50 am by Rocky
» He stressed that the government’s vision is to make one class not exceed 25 students...Government me
Today at 4:48 am by Rocky
» Al-Hakim and Al-Halbousi stress the importance of choosing a speaker for Parliament in accordance wi
Today at 4:47 am by Rocky
» Iron and Steel Company: Iraq is on the verge of a major industrial revolution
Today at 4:46 am by Rocky
» Economists: Citizens still prefer cash transactions over electronic transactions
Today at 4:45 am by Rocky
» The compass of Iraq's foreign policy in a world of turbulent polarization
Today at 4:43 am by Rocky
» Parliamentary Finance: The federal budget is in the corridors of the Council of Ministers, and there
Today at 4:42 am by Rocky
» Integrity calls on citizens to report the inflation of funds in the sector of the Ministry of Labor
Today at 4:40 am by Rocky
» Al-Sudani directs the launch of initiatives for young businessmen and investors
Today at 4:38 am by Rocky
» Representative agriculture emphasizes taking supportive measures for the local product
Today at 4:37 am by Rocky
» An economist calls on the government to support and stimulate the private sector
Today at 4:36 am by Rocky
» Al-Ittihad: Employees and retirees in Kurdistan paid the price of political differences with Baghdad
Today at 4:34 am by Rocky
» Al-Samarrai and Al-Hakim discuss the importance of achieving political and constitutional entitlemen
Today at 4:32 am by Rocky
» Only 23 million dunums. Iraq exploits approximately 50% of its arable land
Today at 4:30 am by Rocky
» Türkiye considers it a political issue.. Where have the negotiations reached regarding Iraq’s water
Today at 4:29 am by Rocky
» Sudanese receives an invitation to attend the Nuclear Energy Summit in Brussels - Urgent
Today at 4:27 am by Rocky
» Central Bank sales exceed $240 million today
Yesterday at 6:52 am by Rocky
» Parliamentary Finance calls on the government to expedite sending the 2024 budget to Parliament
Yesterday at 6:47 am by Rocky
» ‘We’re So Sick of It’: Northern Border Crisis Gets Worse
Yesterday at 6:35 am by Bama Diva
» A representative holds Kurdistan responsible for the faltering legislation of the oil and gas law
Yesterday at 5:27 am by Rocky
» Warnings of the danger of the increase in foreign labor in Iraq
Yesterday at 5:26 am by Rocky
» Iraq's oil exports to America decreased within a week
Yesterday at 5:25 am by Rocky
» Al-Sudani chairs an “important” meeting to form the Kirkuk government
Yesterday at 5:23 am by Rocky
» Investment confirms the adoption of a new method in new residential cities and explains its details
Yesterday at 5:21 am by Rocky
» For the first time in 2024.. exchange rates fall to the threshold of 149 thousand in Baghdad
Yesterday at 5:19 am by Rocky
» Including gold.. An increase in exports of 3 Turkish products to Iraq during 2024
Yesterday at 5:18 am by Rocky
» A detailed integrity report regarding the Housing Fund... called for this matter
Yesterday at 5:17 am by Rocky
» Resources count the number of trespassers in Baghdad.. What about restaurants?
Yesterday at 5:16 am by Rocky
» At a cost of approximately two billion dinars... determining the completion rates achieved in the Ma
Yesterday at 5:15 am by Rocky
» Parliament awaits the “Cabinet of Ministers” law
Yesterday at 5:14 am by Rocky
» Provincial councils return after an absence with a heavy legacy
Yesterday at 5:13 am by Rocky
» Iraq is the axis and meeting point of East and West
Yesterday at 5:11 am by Rocky
» One million beneficiaries of health insurance early next May
Yesterday at 5:10 am by Rocky
» Parliamentary Finance: Delaying the budget had a negative impact on the performance of the ministrie
Yesterday at 5:09 am by Rocky
» The chaos of urban expansion threatens the agricultural character of Diwaniyah
Yesterday at 5:08 am by Rocky
» A project to plant Japanese trees in Erbil
Yesterday at 5:07 am by Rocky
» A team to prepare the national strategy for national security in Kirkuk
Yesterday at 5:06 am by Rocky
» Next Tuesday...concluding a contract to expand the basic design of the city of Mosul
Yesterday at 5:04 am by Rocky
» A festival to reduce food prices in Mosul
Yesterday at 5:03 am by Rocky
» Technical committees between Baghdad and Erbil to resume oil exports through Türkiye
Yesterday at 5:02 am by Rocky
» A model of economic diversification
Yesterday at 5:01 am by Rocky
» Variation in the extent to which Iraq was affected by the decision to reduce the credit rating of {T
Yesterday at 5:00 am by Rocky
» Al-Sudani: Iraq has made a commitment to receive the entire security file from the Ministry of Inter
Yesterday at 4:58 am by Rocky
» The President of the Republic stresses the important role of Mr. Abdul Aziz Al-Hakim in the first st
Yesterday at 4:56 am by Rocky
» The Iraqi Center for Combating Rumors warns against social media celebrities misleading their follow
Yesterday at 4:54 am by Rocky
» Integrity investigates the work of the Housing Fund and indicates debts worth 56 billion dinars
Yesterday at 4:53 am by Rocky
» Agricultural associations in Karbala welcome the provincial council’s decision to prevent the fragme
Yesterday at 4:52 am by Rocky
» Free education lecturers demand that they be given job opportunities and contracts in Kirkuk
Yesterday at 4:51 am by Rocky
» The Digital Media Center calls for not browsing links published on a government page
Yesterday at 4:50 am by Rocky
» The President of the Republic confirms the strength of relations between Iraq and Italy
Yesterday at 4:48 am by Rocky
» A decline in Iraq's oil exports to America during the past week
Yesterday at 4:47 am by Rocky
» Economic researcher for / NINA /: Iraqi youth are qualified for the labor market and relying on them
Yesterday at 4:46 am by Rocky
» The Minister of Planning is following up on the Statistics Authority’s preparations to conduct the g
Yesterday at 4:45 am by Rocky
» 5 days after sending the money and the Kurdistan government has not paid the salaries...a political
Yesterday at 4:44 am by Rocky
» A political reading about Sudanese political concern.. Amending the election law is one of the attem
Yesterday at 4:42 am by Rocky
» Al-Sudani to the Baghdad government: Pay attention to the outskirts of the capital, and drainage mus
Yesterday at 4:41 am by Rocky
» The Iraqi dinar recovers against the dollar in local markets
Yesterday at 4:39 am by Rocky
» Investment provides a summary of Bismaya units... and the new cities have “fixed prices” for the fir
Yesterday at 4:38 am by Rocky
» “Hidden commissions” on electronic fuel cards, contrary to what is advertised.. To whom does 100 mil
Yesterday at 4:37 am by Rocky
» Al-Hasnawi: The government is continuing to accelerate the completion and opening of lagging health
Yesterday at 4:36 am by Rocky
» Oil: The gasoline import file will be closed early next year
Yesterday at 4:35 am by Rocky
» “My account or your account”... a new problem behind the delay in the salaries of the region’s emplo
Yesterday at 4:34 am by Rocky
» Al-Sudani: Iraq is about to host important events and conferences
Yesterday at 4:33 am by Rocky
» In Erdogan's visit to Iraq...the path of development in exchange for water
Yesterday at 4:33 am by Rocky
» An American report on Washington’s seriousness in withdrawing from Iraq: Biden does not want to lose
Yesterday at 4:30 am by Rocky
» The organization is banned in Iraq.. Baghdad decides the fate of the Workers’ Party after 40 years o
Yesterday at 4:29 am by Rocky
» The rain exposes the poor quality of service projects and calls for the dismissal of officials and h
Yesterday at 4:28 am by Rocky
» Politician: Ankara needs Baghdad economically, and the path of development is Iraq’s trump card
Yesterday at 4:26 am by Rocky
» Economic calls to adopt a new philosophy for implementing strategic projects
Yesterday at 4:24 am by Rocky
» Al-Maliki: My alliance with Al-Sadr is possible, and the movement’s distance from it is an unhealthy
Yesterday at 4:23 am by Rocky