10-30-2015, 11:57 AM
China's real unemployment rate is much higher than the official rate and, when correctly measured, is much closer to that in other nations at similar levels of development
www.nber.org/digest/oct15/w21460.html
How to ease monetary policy without accelerating capital outflows? That's the question for China's central bank these days. With economic growth at a six-year low and the PBoC devaluing the currency in August, the central bank has been in a battle to prop up the currency. According to the US Treasury the PBoC spent almost $230bn from July to September, in an effort to defeat predictions that the currency will depreciate further.
“The government is oversaving,” Liang said in a September interview in her office at the Beijing headquarters of China International Capital (CICC), an investment bank where she serves as chief economist. As a result, she says, “the economy is not running efficiently.”
China’s Trouble With Saving 21 Trillion Yuan - Bloomberg Business
Nomura said on Thursday that intervention in August could be around $170 billion, an unprecedented amount for just one month. Analysts at Dutch bank Rabobank estimated that China sold up to $200 billion of reserves in the last few weeks of August alone. Central banks will sell $1.5 trillion of forex reserves by the end of next year as they try to counter capital outflows stemming from China's slowdown, low oil prices and a rise in U.S. interest rates, Deutsche Bank said on Tuesday.
RPT-Investors buckle up for expected drop in China's forex reserves | Reuters
China has tightened its capital controls in a sharp reversal of its market liberalising rhetoric, as it struggles to contain the fallout from last month’s devaluation of the renminbi. The State Administration of Foreign Exchange, the unit of the People’s Bank of China in charge of managing the currency, has ordered financial institutions to step up checks and strengthen controls on all foreign exchange transactions. (FT)
Amid the extreme pessimism about China’s economy in recent months, it is tempting to conclude that rebalancing has failed. Just look at the car market, usually a good shorthand for the health of consumer demand. Automobile sales fell by 3.4% in August compared with a year ago, the third monthly decline in a row. Yet other forms of consumption are accelerating. A property recovery has stoked demand for furniture, home electronics and renovation materials, with sales rising an average of 17% in August from a year earlier. From jewellery to traditional Chinese medicine, buying has picked up in recent months.