‘China’s Credit Impulse Just Turned Negative’

‘China’s Credit Impulse Just Turned Negative’

Lost in the whirlwind of inflation hysteria Wednesday was a notable downside surprise in China's credit data for April. Aggregate financing was just 1.85 trillion yuan last month, well below the 2.29 trillion consensus expected and near the low-end of the range. New yuan loans were 1.47 trillion against expectations for 1.6 trillion (figure below). This seemingly underscores Beijing's commitment to reining in speculation and also the PBoC's generalized aversion to a policy stance that risks
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2 thoughts on “‘China’s Credit Impulse Just Turned Negative’

  1. yep, as a large % of global growth and large economy, china’s credit impulse is key to watch and has abouta 6 month lag until it hits US PMI. Todays inflation reads were from China’s second large dose from 2020, late summer. In the US were trying to take the baton, but our stimulus is much more clunky and takes a while to get into the economy, except for the direct checks, which have already hit.

    Theres a good chance we are seeing the ‘peak inflation fears’ right now. By July 4 were going to hope for 5% gdp in 2021…..and the ironic thing is, media says hoping to get to ‘pre-covid levels’…which were characterized by sub 2% growth and a Fed policy of pushing on a string.

  2. I wonder how large a factor iron ore is in the Chinese PPI numbers. If the PRC authorities are looking to slow property investment, how much longer is the spike in iron ore prices sustainable?

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