Chinese shares slipped amid bearish cues from overnight US equities and continued worries over the global economic slowdown. The benchmark Shanghai Composite index ended down 0.60% while the CSI 300 index slipped by 0.9%. Meanwhile, the PBOC lowered its official yuan midpoint for the ninth straight day to a fresh 11-year low at 7.066 per US dollar today. Chinese banks extended 1.06 trillion yuan in net new loans last month, sharply down from 1.66 trillion yuan in June. There corporate lending tumbled in July, plummeting by two-thirds to 297.4 billion yuan from 910.5 billion yuan the month before. This capped the benchmark indices after the Shanghai Composite fell to near five month low in last week. The markets had surged yesterday Shanghai Composite Index soaring around 1.45%.
Meanwhile, a latest update from the IMF over the weekend noted that after slowing last year, China's debt accumulation accelerated in the first quarter of 2019. By avoiding further stimulus measures, China would help check the pace of debt accumulation. However, some modest fiscal stimulus would be appropriate to offset the negative impact to the economy of higher US tariffs on Chinese goods, says the IMF.
Despite gradual opening to foreign trade and investment, China remains less open than other G20 emerging market economies in services and foreign direct investment. An agreement with the United States has the potential to support the global trading system, and could also benefit China through further opening up its trade and foreign investment regime and bring about other structural reforms that enhance competition.
Powered by Capital Market - Live News
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)