Headline News: Central Reform Commission pledges to boost commodity reserves and regulation; regular session talks on commodities; Li Keqiang calls for energy transformation; multinational manufacturing expansion slackens in August; Non-farm payrolls fell far short of expectations in August and initial claims for unemployment benefits fell to a new low in the week.
Data tracking: In terms of funds, the central bank netted 40 billion yuan during the week; Mysteel’s survey of 247 blast furnaces showed the same operating rate as last week, with 110 coal washing plants operating at 70 percent of stations four weeks apart; and iron ore prices dropped 9 percent during the week, the prices of thermal coal, rebar and flat copper increased significantly, the prices of cement increased and the prices of concrete remained stable, the daily average retail sales of passenger cars dropped by 12% to 76,000 during the week, and the BDI dropped by
Financial Markets: Major Commodity Futures Rose This Week; global equities were mostly lower; the dollar index fell 0.6% to 92.13.
1. Important Macro News
1. Spotlight on the twenty-one meetings of the Central Commission for Comprehensive Reform chaired by Chinese President Xi Jinping, which stressed the need to improve the market regulation mechanism of the strategic reserves and enhance commodity reserves and regulation capacity, we will make better use of the strategic reserve to stabilize the market; strictly control access to the “two high” projects and foster new green and low-carbon growth momentum; strengthen anti-monopoly and anti-Unfair competition regulation; and intensify the battle against pollution. On September 1, Premier Li Keqiang chaired a meeting of the China State Council executive meeting to address such issues as high commodity prices leading to higher production and operating costs, increased accounts receivable, and the impact of the epidemic, on the basis of the policy of benefiting enterprises, we should take further measures to stabilize the main body of the market, stabilize employment and keep the economy running in a reasonable range.
On September 3, Premier Li Keqiang attended the opening ceremony of the 2021 on low carbon energy development in Taiyuan by video. We will promote a revolution in energy consumption, supply, technology and system, strengthen international cooperation on all fronts and effectively promote energy transformation, Li Keqiang said. While doing a good job of cross-cycle adjustment of macro-policies, we will accelerate the optimization and upgrading of industrial structure, first-hand “subtracting” , strictly controlling the scale of production capacity in high-energy-consuming and high-emission industries, and second-hand “adding” , vigorously developing energy-saving and environmental protection industries.
China’s manufacturing PMI was above the critical level of 50.1 in August, down 0.3 percentage points from the previous month, as expansion in the manufacturing sector weakened. The CAIXIN MANUFACTURING PMI fell to 49.2 in August, the first contraction since May last year. The caixin manufacturing PMI fell below the official manufacturing PMI threshold, indicating greater pressure on small and medium-sized enterprises.
The manufacturing PMI for the rest of the world showed a slowing trend in August. The US manufacturing PMI fell to 61.2, below expectations of 62.5, the lowest level since April, while the eurozone’s initial manufacturing PMI hit a two-year low of 61.5 Several Southeast Asian countries, including Vietnam, Thailand, the Philippines, Malaysia and Indonesia, continued to see manufacturing PMI contraction in August. This shows that the world’s major countries or regions have weakened the momentum of economic recovery.
On September 3rd the United States Department of Labor released figures showing that only 235,000 jobs had been added in the non farm sector, compared with a forecast of 733,000 and a previous estimate of 943,000. Non-farm payrolls in August fell short of market expectations. Market analysts said weak non-farm data would almost certainly discourage the Fed from shrinking its debt. CLARIDA, the Fed’s vice chairman, has said that if job growth continues at around 800,000 jobs, the Fed’s governor, Våler, has said that another 850,000 jobs could reduce debt purchases by the end of the year.
New claims for unemployment benefits in the United States fell 14,000 to 340,000 in the week ended Aug. 28, slightly better than expected, to the lowest level since the outbreak and the sixth straight week of decline, according to the United States Department of Labor, it shows that the U.S. job market continues to improve.
On the evening of September 2, Chinese President Xi Jinping delivered a video address at the Global Services Trade Summit of the 2021. We will continue to support the innovative development of small and medium-sized enterprises, deepen the reform of the new third board, establish the Beijing Stock Exchange, and create a main position for serving innovative small and medium-sized enterprises, Xi said.
On September 1,2021 China (Zhengzhou) International Futures Forum was officially held. Liu Shijin, a member of the Monetary Policy Committee of the Central Bank, said that China’s macro-economy may return to a near-normal state in the fourth quarter, there has been no fundamental change in the fundamentals of supply and demand for commodities, and price increases are short-term phenomena. Fang Xinghai, vice chairman of the China Securities Regulatory Commission, said that in expanding the opening up of China’s commodity markets to increase pricing influence.
The State Council issued several measures on promoting reform and innovation of trade and Investment Facilitation in the pilot free trade zone, with a view to speeding up the construction of the open highland, china will accelerate the building of a new development pattern featuring greater domestic circulation and mutual promotion of domestic and international circulation, and build an international commodity futures market priced and settled in Renminbi.
On September 4, Luo Tiejun, vice chairman of the China Iron and Steel Association, said that recently the relevant departments are studying to support the improvement of domestic iron ore resources support capacity, and the association will closely cooperate to do a good job in this work. It is hoped that iron ore mining enterprises will make joint efforts to increase domestic iron concentrate production by more than 100 million tons during the 14th five-year plan period.
The Ministry of Finance has issued a circular on the overall development of the Yangtze Economic Zone with fiscal and tax support policies, according to the ministry’s website. The National Green Development Fund and other key projects are focused on the Yangtze economic zone. The first phase of the National Green Development Fund will be 88.5 billion yuan, with central government funding of 10 billion yuan and the participation of the provincial government and social capital along the Yangtze River.
Statistics from the Ministry of Commerce show that China’s service trade maintained a good growth trend from January to July this year. The total value of services imports and exports totaled 2,809.36 billion yuan, up 7.3 percent year on year, of which 1,337.31 billion yuan was exported, up 23.2 percent, while imports totaled 1,472.06 billion yuan, down 4 percent.
The National Development and Reform Commission (NDRC) issued the implementation plan for promoting the high-quality construction of the new land-sea corridor in the West during the 14th five-year plan. The plan proposes that by 2025 an economic, efficient, convenient, green and safe new land-sea corridor in the West will be basically completed. The continuous strengthening of the three routes has played an important role in driving economic and industrial development along the routes.
The ADP employed 374,000 people in August, compared with an expected 625,000, up from 330,000. ADP payrolls in the US continued to improve from last month, but fell sharply short of market expectations, signalling a slowing recovery in the US labour market.
The US trade deficit narrowed to $70.1 BN in July, compared with an expected deficit of $70.9 BN, compared with an earlier deficit of $75.7 BN.
The ISM manufacturing index for August was 59.9, compared with a forecast of 58.5 in July. The re-emergence of backlogs underlines the impact of supply bottlenecks on manufacturing. The Employment Index fell back into contraction, with the material payment price index at its lowest level in 12 months.
The European Central Bank’s Governing Council plans to end emergency bond purchases in March next year.
Euro-zone inflation hit a 10-year high of 3 percent in August, according to preliminary data released by Eurostat on the 31st.
On September 1, Chile’s Central Bank surprised markets by raising interest rates by 75 basis points to 1.5 per cent, the largest increase in Chile’s 20-year history.
2. Data tracking
(1) financial resources
3.Financial Market overview
During the week, commodity futures, the main varieties rose. LME Nickel rose the most, at 4.58 per cent. On the Global Stock Market Front, most of the world’s stock markets are down. Among them, China Science and Innovation 50 index, gem index fell the first two, respectively, fell 5.37% , 4.75% . In the foreign exchange market, the dollar index closed down 0.6 per cent at 92.13.
4.Next week’s highlights
1. China will publish key macro data for August
Time: Tuesday to Thursday (9/7-9/9) comments: Next week China will release August Import and export, social integration, M2, PPI, CPI and other important economic data. On the export side, the foreign trade container throughput of the eight major hub ports in August was higher than that in July. The backlogs of pre-orders and the spread of overseas outbreaks may increase the import demand for Chinese goods. The export growth rate may continue to maintain its resilience in August. On financial data, it is estimated that new credit of 1.4 trillion yuan and new credit of 2.95 trillion yuan will be added in August, while stock market financing increased by 10.4% and M2 by 8.5% year on year. The PPI is expected to be 9.3% yoy in August, compared with 1.1% yoy in August.
(2) summary of key statistics for next week
Post time: Sep-06-2021