📍China's real estate continues to decline, the government's support packages are only "band-aid" solutions.



🔻 The sales of houses by the 100 largest real estate companies in China fell -24% Y/Y in July (, the lowest in 10 months ). This figure continues the decline of -23% from the previous month. Month-on-month, it dropped by -38% M/M (, the lowest since the beginning of the year ).

🔻 Both new and old house prices fell together in June, exceeding -0.5% M/M.

🔻 The PBoC continues to inject 544.8B CNY through a 7-day RRP at an interest rate of 1.4%. It is still just a temporary adjustment, not addressing the issue.

🔻 Most large real estate enterprises are still in a state of insolvency, with over 70% of USD bonds across the industry defaulted. Evergrande is about to be delisted, Country Garden is losing liquidity, and anyone who tried to catch the bottom of the Chinese market a year ago must have already faced the harsh realities of the market.

🔻However, I think that the economic downturn in China will not cause a chain crisis. China's room for maneuver is very large. Beijing is just not timing the stage to potentially implement QE to push the economy back. This stage is only about injecting liquidity to let the market cool down naturally after many decades of overheating.
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