Growth in manufacturing remains steady, signals economic stabilisation.
Growth in China’s manufacturing sector remained steady for a third consecutive month, with figures for May adding to recent evidence China’s economy is stabilising. The manufacturing purchasing index stood at 50.1 in May, unchanged from April. A reading above 50 indicates expansion while below 50 indicates contraction. The index spent much of 2015 in contractionary territory, but has rallied in the first half of 2016. The figures will be welcomed by policy makers, as they strive to maintain economic growth above 6.5 percent this year while cutting excess capacity in industries like coal and steel. Read more at Bloomberg.
China calls for better communication with US Federal Reserve ahead of high-profile meetings in Beijing.
Chinese officials have called for greater communication on monetary policy between the US Federal Reserve and the international community. Speaking ahead of this week’s eighth Strategic and Economic Dialogue, held in Beijing and attended by high-ranking Chinese and US officials, China’s vice minister of finance Zhu Guangyao said his government opposed any competitive currency depreciation and welcomed a robust exchange of ideas on key trade matters to address slow global growth. Leaders from the two countries including US vice president Joe Biden will discuss macroeconomic policies, trade, investment and financial reform at the week-long meetings. Read more at China Daily.
Chinese consumption ‘tidal wave’ for Australia
Chinese consumption could be the largest opportunity for Australian investors over the coming decade, according to a leading investment manager. Ellerston Capital chairman Ashok Jacob told the 2016 Stockbrokers Association of Australia conference China’s consumption was “coming through like a tidal wave” and was quickly becoming a major theme for Australian business. Mr Jacob likened the rapidly growing Chinese demand for imported consumer goods to the mining boom, and said the strong demand for Australian infant formula and health supplements reflected the enormous opportunities for Australian producers. Mr Jacob was once a close financial advisor to billionaire James Packer. Read more at SBS.
Record Chinese travel to Australia drives service export growth.
International short-term visitors to Australia hit record highs in April driven by a 20 percent increase in Chinese arrivals over the last 12 months, according to Australian Bureau of Statistics figures released last week. Chinese tourism in Australia has doubled in five years, sending the value of Australian service exports soaring. In April, they topped $6.34 billion, the highest monthly figure on record and 18.9 percent greater than the same month last year. The value of tourism grew even faster over the same period, at 21.7 percent. As a result of this rapid growth, services now account for 24 percent of all Australian exports. Commsec’s chief economist Craig James said it was a “silent boom” that was only just beginning. He said it was evidence Australia’s economy was rebalancing after the decade long mining boom. Read more at Business Insider