China’s crackdown on fake export invoices used to disguise money flows is probably cutting the nation’s trade figures, revealing subdued global demand that will weigh on economic growth.
China’s manufacturing is contracting in May for the first time in seven months, adding to signs that economic growth is losing steam for a second quarter.
China’s trade surplus is one-tenth the official $61 billion reported so far this year after accounting for fake transactions used to disguise hot-money inflows, Bank of America Corp. says.
China’s commerce ministry signaled concern that weakness in the yen is limiting Japanese demand for exports just as a stronger yuan weighs on Chinese manufacturers’ global sales.
Prudence Investment Management (Hong Kong) Ltd. is boosting holdings of dim-sum bonds, betting China will allow the yuan to appreciate as much as 5 percent in the next 12 months as the economy averts a “hard landing.”
China’s foreign direct investment rose for a second month in March, a sign of confidence in the world’s second-biggest economy amid last quarter’s unexpected growth slowdown.
Taiwan is poised to sell its first Chinese yuan-denominated bonds, following Hong Kong and London, as the cities compete for business in a currency that is moving toward becoming convertible.
Bonds without credit ratings or maturities led the slump in all of this year’s new dollar- denominated issues from Chinese companies as investors balked at riskier debt and favored rallying equities.
Taiwanese investors accepted such a low yield on the first yuan bonds sold on the island that global funds including HSBC Global Asset Management stayed away.
Higher-yielding Dim Sum bonds are a good bet following a recent sell-off that was driven by concern some issuers will struggle to pay their debt, according to BOC International Holdings Ltd.
"The government may speed up the approval of foreign- funded projects."
- Steve Wang on Apr 17, 2013