Latest news with #Reuters-polled
Yahoo
13 hours ago
- Business
- Yahoo
ETFs in Focus as China Exceeds Growth Expectations in Q2
China's economy expanded at a slightly faster-than-expected pace in the second quarter of 2025, surpassing Beijing's full-year target of 5%. This stronger performance has eased immediate pressure on policymakers to introduce further economic stimulus, as quoted on CNBC. According to the National Bureau of Statistics (NBS), gross domestic product (GDP) grew by 5.2% in Q2, outpacing the 5.1% forecast by Reuters-polled economists. However, this figure still marked a slowdown from the 5.4% growth recorded in the first quarter. Despite some weak spots, analysts believe China may hold off on introducing additional stimulus measures in the near term, as quoted on CNBC. Some analysts believe that more significant stimulus could be delayed until September, should economic momentum weaken further. Beijing's earlier stimulus efforts have had a partial effect. Manufacturing activity improved. Exports held up well. Shipments to Southeast Asia rose by 13%, and exports to the European Union increased 6.6%. In April, U.S. President Donald Trump escalated tariffs on Chinese imports to a steep 145%, prompting Beijing to deploy a round of supportive measures. The two countries reached a truce in May, agreeing to roll back most tariffs. A follow-up meeting in London in June resulted in a framework agreement, with China committing to faster approval of rare-earth mineral exports, while the United States pledged to ease technology restrictions and relax visa rules for Chinese students. A deadline of August 12 has been set for finalizing a permanent trade agreement. Despite outward signs of resilience, economists warn of underlying vulnerabilities in the Chinese economy. In a recent report, People's Bank of China (PBOC) advisor Huang Yiping and co-authors urged the government to introduce up to 1.5 trillion yuan in fiscal stimulus to bolster household spending and counter the effects of U.S. tariffs. China's economy appears to be on track to meet its 5% growth target for 2025, supported by exports and selective stimulus. However, weaker domestic demand, a struggling real estate sector, and global uncertainties are negatives. Against this backdrop, investors can keep a track of China-based exchange-traded funds (ETFs) like iShares MSCI China ETF MCHI, KraneShares CSI China Internet ETF KWEB, iShares China Large-Cap ETF FXI, Xtrackers Harvest CSI 300 China A-Shares ETF ASHR and Invesco China Technology ETF CQQQ. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report iShares China Large-Cap ETF (FXI): ETF Research Reports Invesco China Technology ETF (CQQQ): ETF Research Reports iShares MSCI China ETF (MCHI): ETF Research Reports KraneShares CSI China Internet ETF (KWEB): ETF Research Reports Xtrackers Harvest CSI 300 China A-Shares ETF (ASHR): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research
NBC News
18 hours ago
- Business
- NBC News
China's second-quarter growth beats forecasts but deflation fears fuel calls for stimulus, deeper reform
China's economy grew at a faster-than-expected rate in the second quarter, keeping the country on track to meet its full-year target of 5% and easing some pressure on policymakers to step up stimulus to underpin growth. China's gross domestic product expanded by 5.2% in the second quarter, according to China's National Bureau of Statistics on Tuesday. While the growth rate beat Reuters-polled economists' estimates of a 5.1% growth, it represented a slowdown from the 5.4% in the first quarter. In June, retail sales growth slowed to 4.8% from a year earlier, compared with the 6.4% year-on-year increase in May. That figure also disappointed Reuters-polled economists' forecast of 5.4%. Catering sales, including food and beverages, edged up by just 0.9%, its worst performance since December 2022 when the country grappled with a receding pandemic, according to Wind Information. Industrial output expanded by 6.8% from a year earlier, versus median estimates of 5.7%. Fixed asset investment grew 2.8% in the first half of this year against estimates of a 3.6% increase in a Reuters poll. The slump in real estate investment deepened, falling 11.2% in the first half of the year, compared to a 10.7% drop in the first five months, while investment in infrastructure and manufacturing also slowed. 'The real estate market is still in a process of bottoming,' Laiyun Sheng, deputy commissioner at the NBS, said at a press briefing following the data release, calling for 'stronger support' to stabilize the sector. Domestic consumption contributed to 52% of GDP in the first half of the year, Sheng said, highlighting that the share of consumption rose in the second quarter while the contribution of trade fell. He spoke broadly of plans to support retail sales, and acknowledged that policymakers need to boost income to sustain a rebound in spending. Sheng expected modest improvement in consumer prices in the second half of the year, citing Beijing's efforts to encourage spending while stopping disorderly price wars. The urban unemployment rate remained at 5% in June, after touching a two-year high of 5.4% in February. 'Although growth is likely to slow in the second half-year, the 5% government target may be within reach,' said Tianchen Xu, senior economist at Economist Intelligence Unit, who expected policymakers to refrain from rolling out additional stimulus measures at an upcoming meeting of the Communist Party's Politburo in late July. Beijing could hold off major stimulus until September to stage a final push to meet its growth target if momentum falters, Xu added. Tariff wildcard In April, U.S. President Donald Trump ratchet up tariffs on Chinese imports to a prohibitive level of 145%, spurring a round of stimulus measures from Beijing, including financial support for exporters struggling to take orders, subsidies for companies that hire fresh graduates and continuous expansion of a consumer goods trade-in program to boost demand. The two sides reached a truce in May, agreeing to roll back most of their tariffs on one another. Their respective trade negotiators later outlined a framework after a meeting in London in June, which involved China expediting approval for exports of rare-earth minerals and Washington walking back its restrictions on Beijing's access to advanced American technologies and Chinese students' visas to study in the U.S. Beijing faces an Aug. 12 deadline to work out a permanent deal with Washington. U.S. Treasury Secretary Scott Bessent told CNBC earlier this month that he expected a meeting with his Chinese counterpart 'in the next couple of weeks' to advance discussion on trade and other matters. 'If the threat of trade war diminishes at least in the short term, the chance of a large fiscal stimulus in China also declines,' said Zhiwei Zhang, president and chief economist at Pinpoint Asset Management. Calls for stimulus China's economy has remained on a generally firm footing this year, buoyed by robust exports and support measures, but economists are largely cautious of more economic headwinds ahead, calling for the leadership to launch fresh fiscal stimulus. 'The above-target growth in Q1 and Q2 gives the government room to tolerate some slowdown in the second half of the year,' said Zhang. The Chinese leadership in May unveiled a slew of policy steps in its bid to shore up the tariff-hit economy, including cutting interest rates and injecting additional liquidity into the market. The stimulus measures have lifted parts of the economy. Both official and private surveys showed an improvement in the manufacturing activity. Exports have also remained largely resilient in the quarter as businesses accelerated to divert trade to alternative markets. Its U.S.-bound shipment shrank 10.9% this year as of June, while exports to Southeast Asia nations and European Union countries — the groupings China counts as its two largest trading partners — jumped 13% and 6.6%, respectively. However, that resilience was mainly driven by 'price discounting,' which was 'eroding' China's terms of trade and intensifying disinflationary pressures, Louise Loo, head of Asia economics at Oxford Economics, said in a note. China's GDP deflator, a broad measure of prices across goods and services, however, was still down 1.2% year-on-year, marking the sharpest decline since the global financial crisis, Loo added. PBOC advisor Huang Yiping, in a report published last week with two other economists, said that authorities need to add as much as 1.5 trillion yuan in fiscal stimulus to spur household spending and offset impacts from the U.S. tariffs, as well as cut interest rates further. 'Deeper indicators such as soft consumer price index, weak purchasing managers' index readings, cautious credit dynamics and elevated migrant worker unemployment point to underlying fragility,' the economists said. Structural reforms around China's fiscal plans, pension system and the financial sector are needed to ensure a more balanced, sustainable growth, the economists said.
CNBC
a day ago
- Business
- CNBC
China's second-quarter GDP growth slows to 5.2% as economists warn of mounting headwinds
China's economy grew at a slower clip in the second quarter, as trade tensions with the U.S. rattled an economy already mired in deflation and a years-long housing downturn, raising pressure on Beijing to step up stimulus to underpin growth. China's gross domestic product expanded by 5.2% in the second quarter, according to China's National Bureau of Statistics on Monday, slightly beating Reuters-polled economists' estimates of a 5.1% growth, and decelerating from the 5.4% in the first quarter. In June, retail sales growth slowed to 4.8% from a year earlier, compared with the 6.4% year-on-year increase in May. That figure also disappointed Reuters-polled economists' forecast of 5.4%. Industrial output expanded by 6.8% from a year earlier, versus median estimates of 5.7%. Fixed asset investment grew 2.8% in the first half of this year against estimates of a 3.6% increase in a Reuters poll. The urban unemployment rate remained at 5% in June, after touching a two-year high of 5.4% in February. In April, U.S. President Donald Trump ratchet up tariffs on Chinese imports to a prohibitive level of 145%, spurring a round of stimulus measures from Beijing, including financial support for exporters struggling to take orders, subsidies for companies that hire fresh graduates and continuous expansion of a consumer goods trade-in program to boost demand. The two sides reached a truce in May, agreeing to roll back most of their tariffs on one another. Their respective trade negotiators later outlined a framework after a meeting in London in June, which involves China expediting approval for exports of rare-earth minerals and Washington walking back its restrictions on Beijing's access to advanced American technologies and Chinese students' visas to study in the U.S. Beijing faces a deadline of Aug. 12 to work out a permanent deal with Washington. The Chinese leadership in May unveiled a slew of policy steps in its bid to shore up the tariff-hit economy, including cutting interest rates and injecting additional liquidity to the market. The stimulus measures have helped lift certain aspects of the economy. Both official and private surveys showed an improvement in the manufacturing activity. Exports have also remained largely resilient in the quarter as businesses accelerated to divert trade to alternative markets. Its U.S.-bound shipment shrank 10.9% this year as of June, while exports to Southeast Asia nations and European Union countries — the groupings China counts as its two largest trading partners — jumped 13% and 6.6%, respectively. That sent the share of China's exports to the U.S. to 11.9% in the first half of this year, from 14.1% over the same period last year, according to the customs data released Monday. While China's economy has remained on a generally firm footing this year, buoyed by robust exports and support measures, economists are largely cautious of more economic headwinds ahead, calling for the leadership to launch fresh fiscal stimulus. PBOC advisor Huang Yiping, in a report published last week with two other economists, said that authorities need to add as much as 1.5 trillion yuan in fiscal stimulus to spur household spending and offset impacts from the U.S. tariffs, as well as cut interest rates further. While the recent economic data suggested China's economic growth may top 5% in the second quarter, "deeper indicators such as soft consumer price index, weak purchasing managers' index readings, cautious credit dynamics and elevated migrant worker unemployment point to underlying fragility," the economists said. Structural reforms around China's fiscal plans, pension system and the financial sector are needed to ensure a more balanced, sustainable growth, the economists said.
CNBC
21-05-2025
- Business
- CNBC
Japan exports growth slows for a second straight month as U.S. tariffs bite
Japan exports slowed for a second straight month, government data showed Wednesday, as the country reels under U.S. President Donald Trump's sweeping tariffs. Exports growth of 2% was in line with Reuters-polled analysts' estimates, its slowest since October last year and the worst showing since September when exports contracted 1.7%. The country's imports shrank 2.2% from a year ago, less than estimates of a 4.5% decline. Japan's real gross domestic product contracted an annualized 0.7% in the first quarter this year, preliminary government data showed, dragged down by stagnant private consumption and slowing export growth. The country is among the hardest-hit by Trump's imposition of 25% tariffs on auto imports, effective April 3, and 25% levies on steel and aluminum that took effect in March. Automobiles are Japan's top export to the U.S., accounting for 28.3% of all shipments in 2024, according to customs data.
