Once a year the IMF send a team to talk with policy makers in China to assess the economy, analyze the progress of reform, and offer suggestions that could help planners achieve objectives. They’re kind enough then to share findings with the rest of us.
This year’s report was published last Thursday, July 26th and is overall a positive assessment. The report is packed with useful charts and they’ve pulled the six best which you can access via this link Six Charts.
In summary they find:
Improved credit efficiency
Economic momentum remaining strong
Reduced capital outflows and lower exchange rate pressure
Financial sector de-risking accelerating
Steel, coal and housing capacity/inventory further reduced
Rebalancing continuing
Credit growth further reined in
The key recommendations are; monetary policy needs some tightening (their Chinese contacts don’t agree monetary policy is particularly accommodating) and openness must continue to be fostered. Risks are though, it should in fairness also be noted, mostly to the downside [!?].
In addition to the Top-6 there’s a blizzard of helpful charts that start on P34 of the report which you might just want to fast forward to. Here’s my favorite..
You can access the full report via this link IMF Annual China Report.
Happy Sunday.