LOOMING “MACRO CHALLENGE”
Yan Yuejin, deputy director of the E-house China R&D Institute in Shanghai, told AFP the moves were driven by “pressure” in the property market.
“Fewer people are buying property these days,” he said.
Getting the property market moving again, Yan said, was key to boosting lagging domestic consumption – another major drag on growth.
China’s leadership last week unveiled a host of measures to boost the economy in one of its biggest drives in years to jumpstart growth.
They also warned the economy was being plagued by “new problems”.
Markets have rallied in Hong Kong and mainland China on the announcements amid hopes of greater support.
On Monday, property developers were among the big winners, with Kaisa shares rocketing almost 60 per cent, Sunac up more than 16 per cent and Fantasia piling on more than 30 per cent.
However, analysts warned the “bazooka” stimulus was likely still not enough to boost the property market, and one was sceptical that Monday’s new measures would do much to help.
“From a macro perspective these policies are not that important, as these cities account for a small share of the national property market,” Zhiwei Zhang, president and chief economist at Pinpoint Asset Management, said in a note.
“The key policy to address the macro challenge remains … fiscal.”
Highlighting the uphill task for the government, official data showed Monday that manufacturing contracted for a fifth consecutive month in September.
The Purchasing Managers’ Index – a key barometer of industrial output – stood at 49.8 points, the National Bureau of Statistics announced.
Still, it represented a slight improvement from August’s 49.1 points and was above the 49.5 forecast in a survey by Bloomberg.
A figure above 50 indicates an expansion in manufacturing activity, while anything below that is a contraction.
