Everything You Need to Know About China's Economy on Tuesday (Aug. 27)
Your Daily & Trustworthy Updates on the Chinese Economy
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Good Tuesday! This is TIAN in Beijing.
Welcome to monitor the pulse of China’s economy together with me.
DRIVING THE DAY, China's commercial airplane fleet is projected to more than double in size over the next 20 years, driven by economic growth and air traffic demand, according to Boeing's latest market forecast released in Beijing on Tuesday.
Boeing's 2024 Commercial Market Outlook for China predicts a 4.1 percent annual growth in the country's commercial airplane fleet over the next 20 years, from the current 4,300 or so to around 9,700 by 2043.
"It's important to look at how China's economy has recovered from the pandemic and remains very healthy," said Darren Hulst, Boeing vice president of Commercial Marketing.
"The economy continues to grow, private consumption continues to grow, and ultimately industrial production is also on a growth trajectory. All are important drivers of demand for both passenger and cargo traffic," he said.
Boeing forecasted that the Chinese civil aviation market will require 8,830 new airplanes over the next 20 years, including regional jets, single aisle aircraft, widebody aircraft and freighters.
Over the next 20 years, Chinese carriers will need aviation services worth 780 billion U.S. dollars to support the growing fleet, including digital solutions, maintenance and modifications, according to the Boeing market forecast.
MEANWHILE, Profits of China's major industrial firms increased 3.6 percent year on year in the first seven months of the year, official data showed Tuesday.
According to the National Bureau of Statistics (NBS), the growth rate quickened from the 3.5 percent increase registered in the January-June period.
The combined profits of industrial firms with an annual main business revenue of at least 20 million yuan (about 2.81 million U.S. dollars) totaled 4.099 trillion yuan in the first seven months.
In July alone, profits of major industrial firms rose 4.1 percent compared to a year earlier, according to the NBS.
ALSO ON TUESDAY, China's commerce ministry on Tuesday expressed strong dissatisfaction with and firm opposition against the Canadian government's announcement of imposing additional import tariffs on Chinese electric vehicles (EVs).
The remarks came after the Canadian government said Monday that it will take restrictive measures including new tariffs on EVs as well as steel and aluminum products imported from China.
Commenting on this move, a spokesperson for the Ministry of Commerce said that the Canadian government disregarded the facts and World Trade Organization (WTO) rules, ignored China's repeated solemn representations and acted unilaterally.
The development of China's EV and other industries is based on their own comparative advantages and a result of open competition, the spokesperson said.
IN ADDITION, Chinese public security authorities have issued a total of 16,000 test licenses for autonomous vehicles, the Ministry of Public Security announced.
At a press conference in Beijing, the ministry also revealed that 32,000 kilometers of roads nationwide have been opened for autonomous vehicle testing.
According to data from the ministry, a total of 250 million digital driver's licenses have been issued nationwide to date. Additionally, a pilot program for digital vehicle licenses has been launched in 60 cities, including Beijing, with digital vehicle licenses issued to over 22 million vehicle owners so far.
IN TODAY'S FINANCIAL MARKET,
Shanghai Composite Index Fell 0.24% on Tuesday
China’s benchmark Shanghai Composite Index (000001.SH) lost 0.24% on Tuesday, while the Shenzhen Component Index (399001.SZ) fell 1.11%.
Shanghai’s tech-heavy STAR 50 Index (000688.SH) lost 1.19% for the day, while Shenzhen’s similar ChiNext Index (399006.SZ) fell 0.94%.
China's benchmark interbank gold prices higher Tuesday
According to the China Foreign Exchange Trade System, the benchmark price for gold that is 99.95 percent pure or above stood at 575.5 yuan (about 80.77 U.S. dollars) per gram, 4.17 yuan higher than the previous trading day.
The price for gold that is 99.99 percent pure or above went up 3.31 yuan from the previous trading day to 574.89 yuan.
Chinese yuan weakens to 7.1249 against USD Tuesday
The central parity rate of the Chinese currency renminbi, or the yuan, weakened 110 pips to 7.1249 against the U.S. dollar Tuesday, 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.
Hong Kong's Hang Seng Index closes 0.43 pct higher
Hong Kong's stock market ended mixed on Tuesday with the benchmark Hang Seng Index up 0.43 percent to close at 17,874.67 points.
The Hang Seng China Enterprises Index climbed 0.44 percent to end at 6,306.36 points, and the Hang Seng Tech Index dipped 0.05 percent to close at 3,501.29 points.
China's central bank conducts reverse repos Tuesday
China's central bank conducted 472.5 billion yuan (about 66.32 billion U.S. dollars) of seven-day reverse repos at an interest rate of 1.7 percent Tuesday.
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 Tuesday in daytime trading on the Zhengzhou Commodity Exchange (ZCE).
The most active cotton contract for January 2025 delivery gained 80 yuan (about 11.23 U.S. dollars) to close at 13,795 yuan per tonne.
On Tuesday, the total trading volume for six listed cotton futures contracts on the ZCE was 287,015 lots with a turnover of 19.74 billion yuan.
Sugar futures closed higher Tuesday in daytime trading on the Zhengzhou Commodity Exchange.
The most active sugar contract for January 2025 delivery gained 42 yuan (5.89 U.S. dollars) to close at 5,613 yuan per tonne.
On Tuesday, the total trading volume for six listed sugar futures contracts on the ZCE was 407,786 lots with a turnover of 22.95 billion yuan.
Iron ore futures closed higher on Tuesday in daytime trading at the Dalian Commodity Exchange.
The most active iron ore contract for January 2025 delivery gained 24.5 yuan (about 3.44 U.S. dollars) to close at 758 yuan per tonne.
On Tuesday, the total trading volume of 12 listed iron ore futures contracts on the exchange was 556,850 lots, with a turnover of about 42.02 billion yuan.
No.1 soybean futures closed higher on Tuesday in daytime trading at the Dalian Commodity Exchange.
The most active No.1 soybean contract for January 2025 delivery gained 75 yuan (about 10.52 U.S. dollars) to close at 4,300 yuan per tonne.
On Tuesday, the total trading volume of six listed No.1 soybean futures contracts on the exchange was 133,925 lots, with a turnover of about 5.74 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.