The Hang Seng index is 20% below its recent peak – a stark contrast to the reopening optimism that had once driven Asia-Pacific's benchmark index to a bull market.
"If growth does not accelerate sufficiently to narrow the output gap, social stability risk may rise and eventually triggerThe National Bureau of Statistics noted the purchasing managers' index for large manufacturers came in at 50, while that of smaller manufacturers was lower. The index for services activity remained in expansionary territory at 54.5, but marked a second-straight month of decline.
"Insufficient demand could be the major concern now, and there are both cyclical and structural causes for it," they wrote, adding the "initial boost to the services sector from reopening could be fading." Citi economists also expect the People's Bank of China to cut its medium-term lending facility rates by 20 basis points and its reserve requirement ratio by 50 basis points by the end of the year.
"We reckon that the Chinese economy could be on the verge of a self-fulfilling confidence trap and believe decisive policy actions are needed," they wrote. "There could be limited room for fiscal easing from the budget and we expect structural easing efforts with more efforts from the central government and quasi-fiscal tools via policy banks," they wrote.
Canada Latest News, Canada Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Hong Kong slides 2% to new 2023 low; Asia markets mixed as China manufacturing contractsAsian markets trade mixed as Republican opposition to the debt ceiling deal grows
Read more »
Huobi HK offers crypto trading in Hong Kong to retail, institutional clientsHuobi is offering crypto trading to retail and institutional clients in Hong Kong, having applied for a regulated crypto exchange license.
Read more »
Seven plead guilty at start of Hong Kong legislature storming trialA closely watched trial involving 13 people who stormed Hong Kong's legislature during pro-democracy protests in 2019 began on Monday with seven people pleading guilty to a rioting charge.
Read more »
Hong Kong media tycoon Jimmy Lai loses bid to terminate national security trialA Hong Kong Court on Monday rejected an application to terminate a landmark national security trial against media tycoon Jimmy Lai, a case that could see him spend the rest of his life in prison if convicted.
Read more »
Hong Kong Police enters metaverse to raise awareness about cyber crimeCybercrime has been on the rise over the past year, and the metaverse is also at risk from activities that can cumulatively cause billions in losses.
Read more »
Rights Group Backtracks on Report of Missing Uyghur ScholarAmnesty International said it feared Abuduwaili Abudureheman had disappeared into Chinese custody in Hong Kong, but new reports indicate he’s in South Korea
Read more »