China’s August economic activity data was published today with beats across the board. The real economy has been showing signs of ‘green shoots’, even as the property sector sinks deeper into distress. We had more or this today with the news that Chinese state-linked developer Sino-Ocean had suspended payment on all its offshore debts. Up until recently the firm had been viewed as among the few developers capable of weathering the property sector’s debt crisis. Earlier this week its share price dropped to a then record low. That decline extended today.

AUD/USD shrugged off the property secotr woes in China and responded instead to the better economic data. AUD/USD is near its session high above 0.6460 as I post. NZD/USD is higher also.

USD/CAD is little net changed on the session. USD/JPY, EUR/USD, GBP/USD are also little changed. Gold has staged a rally and is trading just a few dollars short of US$1920.

There was little other data or news of note. The US Auto Workers Union say they will begin a strike at 3 plants in the US, at a GM, Ford, and Stellantis (Fiat Chrysler / PSA Group) factory. It’ll begin at begin at midnight unless there is some last minute deal reached.

From the People’s Bank of China today we had the Medium-term Lending Facility (MLF) setting, at an unchanged rate of 2.5%. 400bn yuan of MLF matured, 519bn was injected for a net +119bn yuan. The PBOC also added funds via 7-day and 14-day reverse repos in open market operations. It was the first 14-day RR in many months, at a rate of 1.95% from 2.15% previously.

aud china data beat wrap chart 15 September 2023