The coming week will see the release of China’s official Purchasing Managers’ Indexes. Notably, China’s release schedule differs from other nations, occurring on the month’s final day instead of the subsequent month’s first. This data release marks the first significant economic indicator since the implementation of increased US tariffs on Chinese imports, affecting a broad spectrum of goods by 125 percentage points. While there are emerging reports suggesting factory shutdowns and diminished work schedules, alternative high-frequency data sources from China present a contrasting perspective, according to Volkmar Baur, FX analyst at Commerzbank.
CNY demonstrates resilience despite trade pressures
“For instance, steel manufacturing remains remarkably strong. Data from the first twenty days of April indicate that steel output surpassed the equivalent period last year by approximately 10%. Vehicle sales are also currently trending toward substantial single-digit growth for April. Furthermore, the National Statistics Institute reports no noticeable decrease in shipping activity.”
“The housing sector presents a different scenario, with daily sales figures again indicating a considerable deceleration in activity, suggesting the ongoing nature of the downturn. However, it’s important to acknowledge that the housing market has faced challenges for several years, and this trend is unlikely to be significantly influenced by the tariffs.”
