China

Declining world supply chain pressures are being challenged by new disruptions in China tied to the coronavirus pandemic, the New York Federal Reserve reported on Friday, Reuters reported. The regional Fed bank's December Global Supply Chain Pressure Index ticked down to 1.18 from November's revised 1.23 reading. According to the report, supply chain pressures have been easing notably since the spring of last year and bottomed in September, and have since then been bouncing around in a tight range.

China's central bank and the banking and insurance regulator have established a dynamic adjustment mechanism on mortgage rates for first-time home buyers, the central bank said on Thursday, in a bid to further support the property sector. For cities where the selling prices of new homes fall month-on-month and year-on-year for three consecutive months, the floor on mortgage rates can be lowered or abolished for first-time home buyers in phases, according to a statement by the People's Bank of China.

China’s services sector contracted for a fourth straight month in December, underscoring Covid-19’s economic costs just days before the country reopens its borders to revive growth, the Wall Street Journal reported. The Caixin services purchasing managers index, published on Thursday, rose to 48.0 in December, indicating the slowdown of activity in the sector had moderated from the previous month, when the gauge was at 46.7. A reading below 50 indicates contraction.

Sunac China Holdings Ltd. received bondholder approval for an extension on its domestic debt, according to people familiar with the matter, buying the developer more time to deal with its liquidity crunch amid improved policy support, Bloomberg News reported. The company’s Sunac Real Estate unit secured an agreement from debt holders to extend maturities on nine onshore notes and an asset-backed security worth about 16 billion yuan ($2.3 billion) in total, the people said, requesting not to be identified because the matter is private.

People's Bank of China (PBOC) said on Wednesday that a high amount of foreign currency it has bought recently was a result of commercial banks converting their foreign exchange holdings with the central bank into yuan reserves, Reuters reported. China's central bank bought a net 63.6 billion yuan ($9.24 billion) worth of foreign exchange in November，according to Reuters calculations based on PBOC data released earlier on Wednesday, marking the biggest net purchases since October 2014.

Chinese regulators have said e-commerce giant Alibaba’s finance affiliate Ant Group can raise $1.5 billion for its consumer finance unit in an important step forward after the government called off a planned IPO two years ago and ordered the firm to restructure, the Associated Press reported. The China Banking and Insurance Regulatory Commission (CBIRC) in the southwestern city of Chongqing said in a notice dated Dec. 30 that Ant’s consumer credit unit had gained approval to increase its capital to 18.5 billion yuan ($2.7 billion) from 8 billion yuan ($1.16 billion).

A tender for the sale of embattled China Evergrande Group's headquarters in Hong Kong has lapsed again, two sources with knowledge of the matter said on Tuesday, because the offer prices and terms fell short of requirements, Reuters reported. Lenders to the office tower, China Evergrande Centre, valued at between HK$8 billion and HK$9 billion ($1.02 billion and $1.15 billion), appointed a receiver in September to seize the asset and tender it for sale with a bid deadline of Oct 31.

Three weeks after Xi Jinping, China’s top leader, tried to reinvigorate China’s stalled economy by abruptly abandoning his stringent pandemic restrictions, he struck an upbeat note in his annual New Year’s Eve address. “China’s economy has strong resilience, great potential and vitality,” he said. But that optimism is hard to find in downtown Guangzhou, the commercial hub of southern China, the New York Times reported. Nearly three years of “zero Covid” measures have crushed businesses. Streets are lined with shuttered stores and workshops.

China's factory activity shrank for the third straight month in December and at the sharpest pace in nearly three years as COVID infections swept through production lines across the country after Beijing's abrupt reversal of anti-virus measures, Reuters reported. The official purchasing managers' index (PMI) fell to 47.0 from 48.0 in November, the National Bureau of Statistics (NBS) said on Saturday. Economists in a Reuters poll had expected the PMI to come in at 48.0. The 50-point mark separates contraction from growth on a monthly basis.