China

The Chinese government could take further measures if needed to keep the yuan stable, potentially putting downward pressure on the currency, a former foreign exchange regulator said, Reuters reported. Policymakers could increase yuan's flexibility, expand capital outflows, or control capital inflows to rein in the yuan, which could deviate from economic fundamentals in the short term, wrote Guan Tao, global chief economist at BOC International and a former official at the State Administration of Foreign Exchange (SAFE).

Ecuador expects to pull together a trade deal with China at the end of this year and will begin formal debt re-negotiations with the Asian country, Ecuadorean President Guillermo Lasso said on Saturday, after a Beijing visit with his counterpart Xi Jinping, Reuters reported. China became Ecuador's top lender over the last decade, with millions of dollars in long-term credit tied to the handover of crude oil, large investments in hydro-electric and mining projects and other loans. "In China we had a productive meeting with the President Xi Jinping," Lasso posted on Twitter.

Receivers have been appointed over land in Hong Kong that China Evergrande Group used as collateral for a $520 million loan, but the sale of the plot won’t affect the company’s broader restructuring, the troubled developer said, the Wall Street Journal reported. Evergrande was notified Wednesday about the move, which relates to a plot of undeveloped residential land located in Yuen Long, the property company said in a filing late Sunday in Hong Kong. It didn’t name the lender.

Imbalances in the Chinese economy have worsened and delayed China’s transition to consumption-led growth, the International Monetary Fund said in an annual review on Friday, slashing its outlook for the country this year, the Wall Street Journal reported. The IMF assessment, in its Article IV review, reflects growing concern among some economists and officials that greater state intervention in the economy could be hindering China’s long-held goal of “high-quality” growth—one driven by consumption rather than investment.

China's factory activity contracted at the sharpest rate in 23 months in January, underscoring the huge economic costs from the country's zero-COVID approach as surging cases and tough containment measures weighed on output and demand, a private survey showed on Sunday, Reuters reported. The Caixin/Markit Manufacturing Purchasing Managers' Index (PMI) fell to 49.1 in January - its lowest level since February 2020, when the economy was still suffering from country-wide COVID-19 lockdowns in the early days of the pandemic.

Embattled property developer China Evergrande Group said Wednesday that within six months, it aims to release a global restructuring plan that would respect offshore creditors’ legal rights, after a group of its bondholders threatened last week to sue the company for failing to engage with them, WSJ Pro Bankruptcy reported. During a call with offshore creditors, Evergrande promised to follow the rule of law and respect bondholders’ rights, which in some cases include claims on the company’s secured offshore assets, according to people familiar with the matter.

China Evergrande Group shares slumped on Thursday after the developer's thinly detailed roadmap for restructuring left investors dissatisfied and its indebted peers also fell on concerns higher interest rates would raise financing costs, Reuters reported. Regulatory curbs on borrowing have driven China's property sector into crisis, highlighted by Evergrande, the world's most indebted property firm.

China Evergrande Group asked international creditors to give the giant property developer more time to get a grip on its complicated financial situation, and warned that drastic legal action could be destabilizing, the Wall Street Journal reported. The plea came days after a group of international bondholders threatened to enforce their legal rights against Evergrande, saying that they had been unable to engage substantively with the troubled Chinese real-estate company for months.

Chinese developer Yuzhou Group Holdings Co. said that it won’t pay off two dollar bonds due this week, meaning some events of default will occur, as builders continue to struggle meeting debt payments, Bloomberg News reported. The company earlier this month offered to swap the notes for new debt, and investors exchanged most of their holdings. There’s $104.9 million of combined principal remaining, Yuzhou said in a Monday stock exchange filing, and it’s opting not to pay that while planning to relaunch the exchange offer this week.

The provincial government leading China Evergrande Group's restructuring wants to separate the company's offshore assets and sell them to pay off foreign debt, a media report said on Friday, in a boost to foreign lenders' hopes of recouping funds, Reuters reported. Financial intelligence provider REDD said on Friday that the provincial government in Guangdong, where Evergrande is based, aimed to release a framework debt restructuring plan by March that could also wipe out the 60% stake of the group's chairman.