Will tariffs rebuke China’s rebound?
However, American tariffs over major South East Asian countries have expressed concern about China’s economic approach. Vietnam agreed to 20% tariff and 40% levy on transmission bound for the US, potentially ignored the US tariffs, targeting Chinese exporters. China’s exports to Southeast Asian countries including Vietnam jumped 16.8% YOY in June, while exports to the US were 16.1%.
A recession in exports to the US through South East Asian countries can affect the total sugar exports, labor markets and domestic consumption.
Natics Asia Pacific Chief Economist Alicia Garcia Herero commented:
“Export growth may slow down by 2-3% year-on-year in the third quarter of this year, and perhaps only 1% in the last quarter. Shipment of lower value items, which can be easily manufactured elsewhere-like furniture, clothes, shoes and toys to be more impressed. Cycles are originally more affected by the US.
While China’s economic approach has slowed down, Beijing appears optimistic, reinforced by PBOC’s decision to keep the LPRS stable. Garcia Herrero commented:
“Recent comments by top Chinese economic authorities show that they realize something needs to be done. I don’t know how much action vs.
The removal of a US-China trade deal with low tariffs and any remaining export sanctions can delay policy action from Beijing. Nevertheless, the recent promises of Beijing have highlighted the desire to roll out fresh policy measures, faded at the financial speed.
On July 18, Beijing further supported, allegedly said:
“Will further promote consumption, introduce policies to promote services consumption.”
Hang Seng index hits 25,000 on the expectation of economic speed and excitement
The positive spirit of China’s economy, Beijing’s stimulation pledge and the US-China tension have increased the demand for Hong Kong and mainland China-listed shares. The Hang Seng index has increased by 4% in July to date, keeping an eye on the 3 -month winning line. Significantly, for the first time after February 2022, the index broke above 25,000.
Meanwhile, CSI 300 of the mainland China and Shanghai Composite Index have increased by 4.18% and 3.61% in July to date. NVIDIA and Advanced Micro devices plan to resume chip exports to China increased the demand for technical shares. Hang Seng Tech Index and Round Hahil China Dragon ETFs are 5.4% and 2.95% up from July to today respectively. The NASDAQ Composite Index is 2.97% in the month, with NVDIA and AMD, there is an increase of 8.48% and 10.64% in the same period respectively.
