Everything You Need to Know About China's Economy on Tuesday
Daily Updates on the Chinese Economy
by TIANDongdong@CPW in India for G20
-- China's service trade volume exceeds 889 bln U.S. dollars in 2022
China's total service import and export volume reached a record 889.1 billion U.S. dollars in 2022, marking a year-on-year increase of 8.3 percent and maintaining its position as the world's second-largest for the ninth consecutive year.
The scale of offshore service outsourcing is steadily expanding, and the effects of industry transformation and upgrading are evident, as shown in the 2022 China service trade development report, compiled under the leadership of the Ministry of Commerce and published at a forum held during the ongoing 2023 China International Fair for Trade in Services (CIFTIS).
Vice Commerce Minister Wang Shouwen said that in the first half of this year, China's service sector accounted for 56 percent of GDP, contributing 66 percent to economic growth, and 70 percent of foreign investment in China went to the service sector.
Emerging sectors such as digital culture, digital finance, internet healthcare, online education, and smart logistics continue to flourish in China, significantly expanding the application scenarios within the service industry.
In 2022, the exports of digitally deliverable services exceeded 210 billion U.S. dollars, accounting for more than 50 percent of total service exports, according to the report.
-- Guangzhou Port opens 1st regular direct shipping route to Brazil
A fully loaded cargo ship bound for Brazil departed from Guangzhou Port in south China's Guangdong Province on Monday, marking the launch of the port's first regular direct shipping route to the South American country.
It is the fifth maritime route to a BRICS country that Guangzhou Port has opened this year.
The new direct shipping route has reduced the transit time to Brazil by at least five days compared to previous routes, and is expected to lower logistics costs for import and export enterprises, according to Guangzhou Port.
-- China's auto production, sales post steady growth
China's auto production and sales rose 7.4 percent and 7.9 percent year on year, respectively, in the first seven months of this year, posting steady growth, according to an official from the Ministry of Industry and Information Technology (MIIT).
Addressing a press conference on Tuesday, MIIT official Wang Weiming said China is striving to increase its annual automobile sales by 3 percent to 27 million in 2023.
Wang added that it is necessary to strengthen departmental coordination and create policy synergy to stabilize and expand the consumption of new energy vehicles and petrol vehicles.
However, growth challenges persist in the auto industry, with mounting global uncertainties and the continued triple pressure of domestic demand contraction, supply shocks and weakening expectations, the official noted, adding that the task of stabilizing the growth of the industry is arduous.
-- Means of production prices rise in China
The majority of the capital goods monitored by China's statistical authorities registered higher prices in late August compared to mid-August, official data showed.
Of the 50 major goods classified in nine categories, including seamless steel tubes, gasoline, coal, fertilizer, and some chemicals, 32 reported higher prices in the period, 14 saw price declines, while the prices of four remained unchanged, according to the National Bureau of Statistics (NBS).
Specifically, the price for liquefied natural gas (LNG) increased by 3.2 percent in late August compared to mid-August, and the price of sulfuric acid went up 18.3 percent.
During the same period, hog prices decreased by 0.6 percent, according to the NBS data.
-- China's central bank conducts 14-bln-yuan reverse repos
China's central bank conducted 14 billion yuan (1.95 billion U.S. dollars) of seven-day reverse repos at an interest rate of 1.8 percent Tuesday.
The move aims to keep liquidity in the banking system reasonable and ample, the People's Bank of China said in a statement.
-- China's benchmark interbank gold prices higher Tuesday
China's benchmark prices for spot interbank gold transactions were 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 464.61 yuan (64.71 U.S. dollars) per gram, up 1.86 yuan from the previous trading day, while the price for gold that is 99.99 percent pure or above gained 1.71 yuan to 465.5 yuan per gram.
Spot transaction prices on the interbank price inquiry market are allowed to rise or fall within 15 percent from the benchmark prices each trading day.
-- Chinese yuan strengthens to 7.1783 against USD Tuesday
The central parity rate of the Chinese currency renminbi, or the yuan, strengthened 3 pips to 7.1783 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.
-- Chinese shares close lower Tuesday
Chinese stocks closed lower on Tuesday, with the benchmark Shanghai Composite Index down 0.71 percent to 3,154.37 points.
The Shenzhen Component Index closed 0.67 percent lower at 10,540.71 points.
The combined turnover of stocks covered by the two indices stood at 803.9 billion yuan (about 111.99 billion U.S. dollars), shrinking from 884.9 billion yuan on the previous trading day.
Shares related to electric power and plastic products led the gains, while companies that focus on media and real estate reported big losses.
-- Hong Kong's Hang Seng Index closes 2.06 pct lower
Hong Kong's stock market ended lower on Tuesday with the benchmark Hang Seng Index down 2.06 percent to close at 18,456.91 points.
The Hang Seng China Enterprises Index dropped 2.09 percent to end at 6,396.76 points, and the Hang Seng Tech Index shed 2.59 percent to close at 4,193.45 points.
-- Sugar futures close higher
Sugar futures closed higher Tuesday in daytime trading on the Zhengzhou Commodity Exchange.
The most active sugar contract for January 2024 delivery gained 28 yuan (about 3.9 U.S. dollars) to close at 7,058 yuan per tonne.
On Tuesday, the total trading volume for six listed sugar futures contracts on the ZCE was 561,673 lots with a turnover of 39.51 billion yuan.
-- Cotton futures close lower
Cotton futures closed lower Tuesday in daytime trading on the Zhengzhou Commodity Exchange.
The most active cotton contract for January 2024 delivery lost 105 yuan (about 14.63 U.S. dollars) to close at 17,530 yuan per tonne.
On Tuesday, the total trading volume for six listed cotton futures contracts on the ZCE was 448,595 lots with a turnover of 39.25 billion yuan.
-- Soybean futures close lower
No.1 soybean futures closed lower on Tuesday in daytime trading at the Dalian Commodity Exchange.
The most active No.1 soybean contract for November 2023 delivery dipped 27 yuan (about 3.76 U.S. dollars) to close at 5,247 yuan per tonne.
On Tuesday, the total trading volume of six listed No.1 soybean futures contracts on the exchange was 147,188 lots, with a turnover of about 7.67 billion yuan.
-- Iron ore futures close lower
Iron ore futures closed lower on Tuesday in daytime trading at the Dalian Commodity Exchange.
The most active iron ore contract for January 2024 delivery dipped 5 yuan (about 70 U.S. cents) to close at 846.5 yuan per tonne.
On Tuesday, the total trading volume of 12 listed iron ore futures contracts on the exchange was 749,431 lots, with a turnover of about 63.88 billion yuan.