Everything You Need to Know About China's Economy on Thursday (Aug. 29)
Your Daily & Trustworthy Updates on the Chinese Economy
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Good Thursday! This is TIAN in Beijing.
Welcome to monitor the pulse of China’s economy together with me.
DRIVING THE DAY, President Xi meets visiting U.S. national security advisor Jake Sullivan in Beijing. As usual, here are key takeaways from the meeting:
What Xi said are:
As two major countries, China and the United States should be responsible for history, for the people and for the world, and should be a source of stability for world peace and a propeller for common development.
The No. 1 issue for China and the U.S. is to develop a right strategic perception, and they need to first and foremost find a good answer to the overarching question: Are China and the United States rivals or partners?
China is focused on managing its own affairs well and will continue deepening reform comprehensively. China's U.S. policy is highly consistent.
He hopes that the U.S. will work in the same direction with China, view China and its development in a positive and rational light, see each other's development as an opportunity rather than a challenge, work with China to find a right way for China and the United States to coexist in peace and achieve common development on this planet.
He expressed readiness to stay in touch with President Biden to guide and steer the development of China-U.S. relations.
What Sullivan responded are:
President Biden looks forward to having communication again with President Xi soon. This round of strategic communication in China was in-depth, candid, substantive and constructive.
The United States does not seek a new Cold War, it does not seek to change China's system, the revitalization of U.S. alliances is not against China, the United States does not support "Taiwan independence," and it does not seek conflict with China.
The United States hopes to maintain strategic communication with China and find a way for the United States and China to coexist in peace and for U.S.-China relations to develop in a sustainable way.
ALSO ON THURSDAY, Xi made new remarks on deepening reform:
"We must free our minds, seek truth from facts, move with the times, and take a realistic and pragmatic approach," Xi said while presiding over the sixth meeting of the Central Commission for Deepening Overall Reform.
Efforts must be made to accelerate the implementation of landmark reform measures, enhance the consistency of reform policy orientation, and actively assess the impact of reform on economic and social development.
Highlighting the milestone and pioneering institutional innovations introduced by the country's 22 pilot free trade zones since the 18th CPC National Congress held in 2012, the meeting urged pursuing high-standard opening up and focusing on institutional innovations.
It encouraged carrying out pilot reforms and conducting groundbreaking, integrated explorations in this regard.
The meeting also stressed fine-tuning policy mechanisms to facilitate trade, investment, capital flows, transportation and travel, as well as the secure and orderly flow of data.
Efforts are required to ensure both development and security and improve risk prevention and control capabilities.
MEANWHILE, Chinese authorities will carefully study expert opinions and suggestions on increasing tariffs for imported fuel-powered cars with large-displacement engines, China's Ministry of Commerce (MOC) said on Thursday.
Such proposals will be researched in accordance with procedures, MOC spokesperson He Yadong told a press conference, noting that green and low-carbon transition of the auto industry will be supported to ensure high-quality development.
He said that experts who put forward the suggestions believe they are in line with World Trade Organization rules and will be beneficial to the green transformation of the auto industry.
Commenting on the European Union (EU)'s anti-subsidy probe into Chinese electric vehicles, he described it as a typical protectionist move, which is not conducive to China-EU auto industry cooperation, the stability of the global automobile production and supply chain, the EU's green transition, and global efforts to combat climate change.
ICYMI: China's technology giant Huawei saw its sales revenue increase by 34.3 percent year on year to 58.6 billion U.S. dollars in the first half (H1) of this year, said the company on Thursday.
During the period, the company also recorded a net profit margin of 13.2 percent. The overall business performance of the company is in line with its expectations, according to Xu Zhijun, rotating chairman of Huawei.
Earlier figures show that, in the first half of 2023, its sales revenue reached 310.9 billion yuan, marking a year-on-year increase of 3.1 percent, with a net profit margin of some 15 percent.
IN TODAY'S FINANCIAL MARKET,
Shanghai Composite Index Fell 0.5% on Thursday
China’s benchmark Shanghai Composite Index (000001.SH) lost 0.5% on Thursday, while the Shenzhen Component Index (399001.SZ) rose 0.94%.
Shanghai’s tech-heavy STAR 50 Index (000688.SH) gained 1.25% for the day, while Shenzhen’s similar ChiNext Index (399006.SZ) rose 0.65%.
Chinese yuan weakens to 7.1299 against USD Thursday
The central parity rate of the Chinese currency renminbi, or the yuan, weakened 83 pips to 7.1299 against the U.S. dollar Thursday, according to the China Foreign Exchange Trade System.
In China's spot foreign exchange market, the yuan is allowed to rise or fall by 2 percent from the central parity rate each trading day.
China's benchmark interbank gold prices lower Thursday
According to the China Foreign Exchange Trade System, the benchmark price for gold that is 99.95 percent pure or above stood at 574.6 yuan (about 80.59 U.S. dollars) per gram, 0.9 yuan lower than the previous trading day.
The price for gold that is 99.99 percent pure or above went down 0.66 yuan from the previous trading day to 573.33 yuan.
Hong Kong Hang Seng Index closes 0.53 pct higher
Hong Kong stock market ended higher Thursday with the benchmark Hang Seng Index up 0.53 percent to close at 17,786.32 points.
The Hang Seng China Enterprises Index rose 0.34 percent to end at 6,247.13 points, and the Hang Seng Tech Index rose 0.46 percent to end at 3,461.22 points.
China's central bank conducts reverse repos Thursday
China's central bank conducted 150.9 billion yuan (about 21.16 billion U.S. dollars) of seven-day reverse repos at an interest rate of 1.7 percent Thursday.
The move aims to keep liquidity reasonable and ample in the banking system at the end of the month, the People's Bank of China said in a statement.
AT THE END OF TODAY'S SHARING, LET'S TAKE A LOOK AT YOUR DAILY FUTURES:
Cotton futures closed higher Thursday in daytime trading on the Zhengzhou Commodity Exchange (ZCE).
The most active cotton contract for January 2025 delivery gained 5 yuan (about 70.13 U.S. cents) to close at 13,800 yuan per tonne.
On Thursday, the total trading volume for six listed cotton futures contracts on the ZCE was 367,228 lots with a turnover of 25.23 billion yuan.
Sugar futures closed higher Thursday in daytime trading on the Zhengzhou Commodity Exchange.
The most active sugar contract for January 2025 delivery gained 5 yuan (70.13 U.S. cents) to close at 5,649 yuan per tonne.
On Thursday, the total trading volume for six listed sugar futures contracts on the ZCE was 317,189 lots with a turnover of 17.94 billion yuan.
Iron ore futures closed higher on Thursday in daytime trading at the Dalian Commodity Exchange.
The most active iron ore contract for January 2025 delivery gained 4 yuan (about 56 U.S. cents) to close at 760 yuan per tonne.
On Thursday, the total trading volume of 12 listed iron ore futures contracts on the exchange was 518,221 lots, with a turnover of about 39.3 billion yuan.
No.1 soybean futures closed lower on Thursday in daytime trading at the Dalian Commodity Exchange.
The most active No.1 soybean contract for January 2025 delivery dipped 13 yuan (about 1.82 U.S. dollars) to close at 4,295 yuan per tonne.
On Thursday, the total trading volume of six listed No.1 soybean futures contracts on the exchange was 72,372 lots, with a turnover of about 3.11 billion yuan.
About the Newsletter:
Ran by TIAN Dongdong, this newsletter features daily, trustworthy content on China's economy and regularly updates the insights of Chinese youth on Sino-US relations. Having worked in Brussels, London, Cairo, and Tripoli for Chinese media as correspondent for several years, TIAN is now based in Beijing.