Market Review
Key News
Chinese Market
1. Official from the People's Bank of China mentions enhancing the efficiency of financial support
The financial data for August 2023 released by the People's Bank of China shows that new yuan loans amounted to 1.36 trillion yuan in August, an increase of 868 billion yuan compared to the same period last year; new social financing reached 3.12 trillion yuan, an increase of 631.6 billion yuan from a year earlier. Officials from relevant departments of the People's Bank of China stated that the bank will further enhance coordination with fiscal and industrial policies in the future, strengthen guidance on expectations, closely monitor the effects of financial policies, improve the efficiency of financial support, and create a suitable monetary and financial environment for promoting effective demand in the real economy, supporting moderate price increases, and enhancing economic vitality.
2. Issuing central bank bills helps stabilize the RMB exchange rate
The People’s Bank of China announced it would issue 15 billion yuan of 6-month central bank bills in Hong Kong, including 5 billion yuan of rollovers and 10 billion yuan of additional issuance. This marks the second increase in offshore central bank bills issued by the central bank within a month. The further issuance of offshore central bank bills at this juncture sends a signal that absorbs more offshore RMB liquidity, conducive to maintaining the basic stability of the offshore RMB exchange rate. Moreover, this mechanism can directly address offshore market participants and effectively convey policy intentions.
3. A sharp increase in second-hand housing listings in many cities following new real estate policies
Amidst the optimization and adjustment of real estate policies, some "warming" signals have been released in various places. In this context, the number of second-hand houses listed for sale in many cities has significantly increased. The noticeable increase in second-hand housing listings is mainly due to the "recognizing house not loan" policy encouraging "selling one and buying another," driving up the number of second-hand houses listed. However, if the volume of transactions does not keep up, many owners may choose to lower prices for sale, which in turn can impact market expectations – a phenomenon that deserves significant attention.
International Market
1. U.S CPI rises again in August
Data from the U.S. Department of Labor shows that the year-over-year increase in the U.S. Consumer Price Index (CPI) for August rebounded to 3.7% from 3.2% in July, not only exceeding the expected 3.6% but also marking the second consecutive month of rebound. The month-over-month increase in August's CPI accelerated to 0.6% from 0.2% in July, the largest increase in 14 months. Analysts believe that high oil prices may keep interest rates high in Europe and America for a longer period, and the Federal Reserve is still likely to raise rates in the fourth quarter of this year. Meanwhile, the reacceleration of core CPI could force the Federal Reserve to push rates even higher, potentially leading to economic downturns.
2. IEA warns of a severe shortfall in oil supply in the fourth quarter
The International Energy Agency (IEA), in its recent report, estimates that despite increases in oil production by non-OPEC+ countries such as the USA, Brazil, and Iran totaling 1.9 million barrels/day since the beginning of the year, counteracting the production cuts by OPEC+ producers including Saudi Arabia and Russia. However, due to the extension of supply reduction measures by Saudi Arabia and Russia until the end of this year, a severe shortage in oil supply is expected starting from September.
3. EU targets Chinese electric vehicles with sudden action
Information disclosed on the European Commission's official website shows that Ursula von der Leyen, President of the European Commission, stated during her fourth "State of the Union" address to the European Parliament that the electric vehicle sector is critical to the clean economy and holds huge potential for Europe. The European Commission will initiate an anti-subsidy investigation against electric vehicles imported from China. Industry insiders believe that, for now, the investigation has just been launched, and whether and when related measures will be implemented remains highly uncertain.
4. Alleged "extraterrestrial beings" remains displayed
For the first time, the Mexican Parliament held a public hearing related to "unidentified anomalous phenomena," where the remains believed to be of "extraterrestrial beings" were displayed. The remains, which were found in Peru in 2017, are dated to be 1800 and 700 years old, respectively. The remains have elongated heads and three fingers on each hand. DNA extracted from the remains also shows they were not human.
Today's Focus
Today, investors need to pay attention to the Australian unemployment rate and employment change, U.S. initial jobless claims, PPI, retail sales, and other economic data. In addition, investors should also focus on the European Central Bank's interest rate decision, ECB President Christine Lagarde's press conference, and other risk events.
