The CSI 300 index is now up 2.78% after a lackluster (negative) response to the GDP numbers.
From Bloomberg, October 18:
- GDP rises 4.6% from last year, slowest pace in six quarters
- PBOC disclosed details of measures minutes after data release
China’s central bank moved to support markets just as data showed the economy expanding the least in six quarters, signaling the government’s intent to continue a stimulus push to draw a line under the slowdown.
The People’s Bank of China disclosed more details of its measures to boost capital markets minutes after authorities released figures showing China’s slowdown deepened in the third quarter. At a separate event in Beijing, PBOC Governor Pan Gongsheng flagged the real estate and stock markets as key challenges in the economy that require targeted policy support.
Coordinated or not, the moves by the PBOC and its governor appeared to bolster hope that Beijing would do what it takes to ensure the country reaches its 2024 growth target of around 5%. Although expansion was slower than in previous quarters, better-than-expected data for September offered tentative signs that the economy has bottomed out.
The probability of China achieving its growth goal “now looks very high,” said Jacqueline Rong, chief China economist at BNP Paribas SA. “Only a mild rebound in the fourth quarter will get the job done.”
China’s benchmark CSI 300 Index of onshore stocks rebounded from earlier losses to gain as much as 3.2% after the central bank kicked off a re-lending facility for listed companies and major shareholders to buy back shares.
What Bloomberg Economics Says...
“Given the force and breadth of the policy response in recent weeks, the economy has likely bottomed out. The government will probably now concentrate on implementation, with a particular focus on ensuring local officials deliver fiscal spending that’s been budgeted for the year.”
— Chang Shu and Eric Zhu
....MUCH MORE
