CHINA’S RECOVERY STRENGTHENS WITH GAINS IN PRODUCTION, SALES
Bloomberg, September 12, 2009
China’s expansion strengthened in August as industrial production, lending and retail sales exceeded forecasts, reinforcing a global recovery from the deepest recession since World War II.
The Shanghai Composite Index climbed to a three-week high on yesterday’s reports, and yuan forwards posted their best week in more than five months. Premier Wen Jiabao’s $586 billion stimulus plan and a record $1.1 trillion of lending in the first half of this year have countered a 10-month slump in shipments abroad, helping Asia lead the world’s rebound.
“The closer you are to China the better off you are,” said Tim Condon, head of Asia research in Singapore at ING Groep NV and a former economist at the World Bank.
China’s factory output climbed 12.3 percent last month from a year earlier, the most since August 2008, the statistics bureau said yesterday. Retail sales rose 15.4 percent, the biggest gain this year after accounting for seasonal distortions. M2, the broadest measure of money supply, expanded by a record 28.53 percent. Exports fell for a 10th month.
Wen pledged Sept. 10 to sustain stimulus measures to secure the recovery, saying the rebound “is unstable, unbalanced and not yet solid.” Speaking at a conference in the city of Dalian, he said “we cannot and will not change the direction of our policies when the conditions aren’t appropriate.”
Twelve-month yuan forwards rose to 6.7350 per dollar as of 5:30 p.m. in Shanghai yesterday on speculation that a stronger recovery gives the central bank more room to resume appreciation of the currency.
Bloomberg, September 12, 2009
China’s expansion strengthened in August as industrial production, lending and retail sales exceeded forecasts, reinforcing a global recovery from the deepest recession since World War II.
The Shanghai Composite Index climbed to a three-week high on yesterday’s reports, and yuan forwards posted their best week in more than five months. Premier Wen Jiabao’s $586 billion stimulus plan and a record $1.1 trillion of lending in the first half of this year have countered a 10-month slump in shipments abroad, helping Asia lead the world’s rebound.
“The closer you are to China the better off you are,” said Tim Condon, head of Asia research in Singapore at ING Groep NV and a former economist at the World Bank.
China’s factory output climbed 12.3 percent last month from a year earlier, the most since August 2008, the statistics bureau said yesterday. Retail sales rose 15.4 percent, the biggest gain this year after accounting for seasonal distortions. M2, the broadest measure of money supply, expanded by a record 28.53 percent. Exports fell for a 10th month.
Wen pledged Sept. 10 to sustain stimulus measures to secure the recovery, saying the rebound “is unstable, unbalanced and not yet solid.” Speaking at a conference in the city of Dalian, he said “we cannot and will not change the direction of our policies when the conditions aren’t appropriate.”
Twelve-month yuan forwards rose to 6.7350 per dollar as of 5:30 p.m. in Shanghai yesterday on speculation that a stronger recovery gives the central bank more room to resume appreciation of the currency.
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