The Political Bureau of the Communist Party of China (CPC) Central Committee held an Key meeting on December 9, committing to a more proactive fiscal policy and a moderately loose monetary policy, while also enhancing unconventional counter-cyclical adjustments and expanding domestic demand across various sectors. This marks the latest indication of China's intent to adjust its macroeconomic strategy for 2025.
The U.S. Labor Department reported On December 6 that non-farm payrolls increased by 227,000 in November, marking a significant rebound from the previous month. The unemployment rate for November stood at 4.2%, up 0.1 percentage points from the prior month.
The non-farm employment data for November will play a crucial role in influencing the Federal Reserve's interest rate decisions in December and beyond.
Key Meeting Signals Stronger Policy Support to Propel Economic Growth in China
China has signaled adjustment in its macroeconomic approach for 2025, emphasizing stronger measures to stabilize growth and tackle challenges head-on, as revealed in a crucial meeting of the Political Bureau of the Communist Party of China (CPC) Central Committee on December 9.
During the meeting, the committee committed to implementing a more proactive fiscal policy and adopting a moderately loose monetary policy. This marks the first transition from a "prudent" to a "moderately loose" monetary stance since 2011.
The meeting also highlighted the importance of enhancing unconventional counter-cyclical adjustments and expanding domestic demand across all sectors.
This announcement reflects China's ongoing commitment to revitalizing its vast market and ensuring sustained economic growth.
China's Foreign Trade Shows Steady Growth in First 11 Months
China's total goods imports and exports maintained steady growth in the first 11 months of 2024, expanding by 4.9 percent year on year in yuan terms, the General Administration of Customs (GAC) said on December 10.
Goods trade value expanded to 39.79 trillion yuan, or 5.6 trillion in U.S. dollar terms, in the January-November period. China's exports rose 6.7 percent year on year during this period to 23.04 trillion yuan, while imports climbed 2.4 percent to 16.75 trillion yuan, the GAC data revealed.
In November alone, goods imports and exports saw a year-on-year increase of 1.2 percent to total 3.75 trillion yuan -- maintaining growth for an eighth consecutive month.
China's Robust Economic Growth Reflected in VAT Invoice Data
China's State Taxation Administration on December 10 unveiled the national VAT invoice data for November, revealing robust growth momentum in various sectors, supported by effective policy measures.
Among the country's manufacturing sectors, those with advanced technologies saw remarkable growth last month. Notably, manufacturers of high-tech products such as electronic telecommunication devices and aerospace equipment recorded a 5.1 percent year-on-year increase in sales revenue.
The country's high-tech services sector also grew rapidly in November, with sales revenue rising by 8.4 percent from the year before.
Boosted by China's consumer goods trade-in and equipment renewal programs, the value of machinery equipment purchases increased 4.5 percent among enterprises nationwide.
China's Inflation Rate Eases to 0.2% in November
China's consumer inflation rose 0.2 percent last month but at a slower pace than in October, mainly because of unexpectedly high temperatures and low travel demand, according to data released on December 9 by the National Bureau of Statistics(NBS).
The figure was up 0.3 percent year on year in October.In the first 11 months of the year, the CPI jumped 0.3 percent from the same period last year, according to the NBS.
The producer price index, which measures the cost of goods at the factory gate, plunged 2.5 percent in November from a year earlier, versus a decline of 2.9 percent in October.
In the 11 months ended Nov. 30, the PPI plunged 2.1 percent from a year ago, NBS data showed.
Chinese Firms Cautiously Optimistic About EU Market: Survey Report
Chinese firms remain cautiously optimistic about the EU market amid rising policy uncertainty, according to a report released on December 9 by the China Chamber of Commerce to the EU (CCCEU) and global consultancy Roland Berger.
Ninety percent of surveyed Chinese firms in the EU say that the adverse effects of EU policies focused on "economic security" and "de-risking" are undermining business confidence, the report said.
In sectors such as electric vehicles, anti-subsidy investigations have prompted over 30 percent of firms to adjust their investment plans, the report said.
Despite the challenges, Chinese firms expressed cautious optimism about the EU market. Around 21 percent of the surveyed companies consider the EU their most important market outside China, and 66 percent expect its strategic importance to grow over the next one to three years.
China’s Central Bank Adds to Gold Reserves for First Time in Seven Months as Prices Dip
The People’s Bank of China had 72.96 million ounces of gold as of Nov. 30, an increase of 160,000 ounces from a month earlier, the State Administration of Foreign Exchange said on Dec. 7. It is the first increase since 60,000 ounces were added in April.
The price of gold has risen consistently since the beginning of the year, spurred by global political and economic uncertainties. Prices hit an all-time high of USD2,790 per ounce at the end of October before starting to pull back.
U.S. Job Market Bounces Back in November After Weak Numbers in Previous Month
U.S. job growth rebounded in November, with employers adding 227,000 jobs, according to the Labor Department's report released on December 6.
This comes after weaker numbers in the previous month, when job growth was hampered by the impact of two hurricanes and a Boeing strike.
The October job growth figures were revised upward by 24,000 to a total of 36,000.
The unemployment rate in November ticked up to 4.2 percent, slightly higher than the 4.1 percent recorded in October and above the 3.7 percent rate from a year earlier.
The U.S. Federal Reserve is set to hold its final monetary policy meeting of the year on December 17-18. The encouraging labor market report suggests that the central bank may not need to rush into cutting interest rates.
Japan's Business Sentiment Improves For 3rd Quarter
Japan's business sentiment among large companies improved for the third consecutive quarter for the Oct.-Dec. period over strong demand for semiconductors and digital transformation solutions, government survey results showed on December 11.
The Business Sentiment Index (BSI) for large corporations across all industries came in at plus 5.7, marking the third consecutive quarter of positive growth, according to the survey released by the Cabinet Office and Ministry of Finance.
The report attributed the outcome to strong demand for semiconductors and digital transformation solutions, alongside progress in passing on higher costs to prices.
The BSI outlook for large corporations remains positive for the first half of 2025, with projections of plus 3.9 for January-March and plus 2.6 for April-June.
Global goods trade to expand at moderate pace in Q4: WTO
The World Trade Organization (WTO) announced on December 9 that its Goods Trade Barometer registered a reading of 102.7, indicating that global goods trade is continuing to expand at a moderate pace in the fourth quarter of 2024.
The barometer acts as a composite leading indicator for global merchandise trade. Values above 100 signal above-trend trade volumes, while values below 100 suggest that goods trade may have fallen below trend or is likely to do so soon.
The WTO emphasized that this latest reading implies steady trade growth through the fourth quarter. However, the outlook is clouded by rising economic challenges, including potential shifts in trade policy.
IATA Forecasts Positive Outlook For Global Airline Industry in 2025
The global airline industry in 2025 expects a slight increase in profitability amid ongoing cost and supply chain challenges, the International Air Transport Association (IATA) said on December 10, highlighting some positives such as lower oil prices and growing connectivity.
Net profits are expected to be 36.6 billion dollars in 2025 for a 3.6 percent net profit margin, a slight improvement from the expected 31.5 billion net profit (3.3 percent net profit margin) in 2024, the IATA said in a statement.
Total industry revenues are expected to be 1.007 trillion dollars, up by 4.4 percent from 2024, with expenses expected to grow by 4.0 percent to 940 billion dollars. The IATA said it will be the first time that industry revenues top the 1-trillion-dollar mark.
WEF Highlights Factors Shaping Global Manufacturing, Supply Chains
Infrastructure, energy and resources, technology, labour and skills, fiscal and regulatory policies, geopolitical landscape, environmental, and social and governance are key factors that make a country attractive for foreign investment in manufacturing and supply chains, according to a reported released on December 10 by the World Economic Forum (WEF).
The report titled "Beyond Cost: Country Readiness for Manufacturing and Supply Chains" said that ongoing geopolitical, technological and environmental disruptions are prompting companies to rethink their supply chain network design, with over 90 percent of leaders prioritizing regionalization.
Five key trends, including a move to more regionalized hubs, a transition to a digital-first model of operations, the adoption of more innovative approaches to sustainability and a deeper focus on skills and customer value, are driving the shift to regionalization.
OPEC+ to Keep Oil Output Steady For Q1 2025
The Organization of the Petroleum Exporting Countries (OPEC) and its allies, a group known as OPEC+, agreed on Decomber 5 to keep oil production at the current levels for the first quarter of 2025.
In a statement on the OPEC website, eight OPEC+ countries -- Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Algeria and Oman -- said they would extend voluntary output cuts of 2.2 million barrels per day (bpd), originally announced in November 2023, to the end of March 2025.
These voluntary cuts will be "gradually phased out on a monthly basis until the end of September 2026 to support market stability," but the monthly increase can be paused or reversed as per market conditions, according to the statement.
