The report provides an overview of significant news events in China and its surrounding areas. In terms of economic growth, Goldman Sachs has slightly adjusted its projection for China’s real GDP growth in 2024 from 4.7% to 4.9%. This late Sunday revision reflects optimism about Beijing’s economic stimulus plans, which include pre-approving projects worth 200 billion yuan by month’s end to meet the 5% growth target for this year [para. 2].
In stock market developments, China’s major indices saw volatile trading on Monday following the fiscal stimulus announcement. The Shanghai Composite Index initially fell before rising by 2.07%, echoing gains on other mainland indexes. Meanwhile, Hong Kong’s Hang Seng Index experienced a decline of 0.75% after significant fluctuations earlier in the day [para. 3].
Addressing deflationary trends, China’s consumer price index (CPI) growth in September decelerated to 0.4% on a year-over-year basis. Core CPI, excluding food and energy, hit a low not seen since February 2021, suggesting weak domestic demand. Additionally, September’s producer price index (PPI) dropped by 2.8% compared to the previous year, intensifying the deflationary pressures dampening China’s economic performance [para. 4].
In response to economic pressures, major Chinese banks plan to cut interest rates on existing mortgages, in alignment with a stimulus measure announced by China’s central bank governor, Pan Gongsheng. This move will lower interest rates by 0.3 percentage points below the national loan prime rate, which stands at 3.85% [para. 5].
On international trade relations, China has invited an EU delegation to Beijing for further negotiations over tariffs imposed by the EU on Chinese-manufactured electric vehicles (EVs). These duties followed an anti-subsidy inquiry finding unfair state aid to Chinese automakers. Resolving this dispute is crucial as the EU has been a key export market for Chinese EVs [para. 6].
Regarding energy initiatives, Guangdong province intends to subsidize independent energy storage stations to bolster its wind and solar power capacity. The provincial economic planner has announced a subsidy of 100 yuan per kilowatt annually to support these facilities, which remain unprofitable but are vital for mitigating grid strain from fluctuating renewable energy outputs [para. 7].
In military developments, China’s armed forces conducted extensive drills around Taiwan in a dramatic assertion of deterrence against any moves toward Taiwan’s independence. The maneuvers were a direct response to statements from Taiwan’s leader suggesting disunity with China, which were strongly denounced by Beijing [para. 8].
Politically, Sam Hou Fai has been elected as the Chief Executive of Macao, succeeding in an unopposed election with 98.5% approval from the voting committee. He previously served as president of Macao’s Court of Final Appeal for nearly 25 years [para. 9].
On bilateral relations, Chinese Premier Li Qiang finalized ten agreements with Vietnam across sectors such as agriculture and cross-border payments. Vietnam, as China’s largest trading partner, continues to foster commercial ties, with high-level exchanges, including a meeting between President Xi Jinping and Vietnam’s Communist Party General Secretary To Lam [para. 10].
Overall, these news events reflect China’s active engagement both domestically and internationally as it navigates economic challenges and geopolitical tensions [para. 11].
AI generated, for reference only
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