Greater China Macro Daily(Beta Mode)
China CPI Misses, Equities Advance
Market Snapshot
| Asset | Level | Change |
|---|---|---|
| Shanghai Composite | 3,940.04 | +1.02% |
| CSI 300 | 4,694.44 | +0.93% |
| Hang Seng | 25,668.03 | +0.54% |
| TAIEX | 44,225.91 | -0.38% |
| USD/CNY | 6.74 | -0.17% |
| USD/HKD | 7.84 | +0.01% |
| Copper | 6.64 | +0.99% |
| Brent Crude | 87.85 | +5.15% |
| Gold | 4,448.60 | +2.49% |
| Bitcoin | 63,895.14 | -1.46% |
| China 2Y Govt Yield | - | - |
| China 10Y Govt Yield | - | - |
Prior Economic Events
| Data | Prior | Cons | Actual |
|---|---|---|---|
| Inflation Rate Year-over-Year | 1 | 0.80 | 0.50 |
| Inflation Rate Month-over-Month | -0.30 | 0.20 | -0.10 |
| Producer Price Index Year-over-Year | 4.10 | 3.80 | 3.50 |
Shanghai Composite Index | Type: market_hloc | Index Level: 3940 (2026-08-07) | Range: 3764–4243 | Trend(5pt): 4225,4075,4120,3764,3940
Today's Economic Events
| Data | Prior | Cons | Time |
|---|---|---|---|
| Current Account Preliminary | 184,300m | - | 05:00 |
| House Price Index Year-over-Year | -3.30 | - | 21:30 |
| Industrial Production Year-over-Year | 5.30 | - | 22:00 |
| Retail Sales Year-over-Year | 1 | - | 22:00 |
| Fixed Asset Investment (Year-to-Date) Year-over-Year | -5.70 | - | 22:00 |
- China CPI YoY prints 0.5% versus 0.8% consensus while PPI YoY falls to 3.5%, extending deflationary pressure on mainland growth.
- Shanghai Composite rises 1.02% to 3,940.04 and CSI 300 gains 0.93% as PBoC liquidity injection supports sentiment; Hang Seng adds 0.54%.
- USD/CNY eases 0.17% to 6.74 while TAIEX slips 0.38% amid softer semiconductor supply-chain flows.
Yesterday's Recap
Mainland China inflation data released after market close showed consumer prices rising just 0.5% year-over-year against an 0.8% consensus and 1% prior reading. Month-over-month CPI contracted 0.1% versus an expected 0.2% gain. Producer prices also cooled more than forecast, declining 3.5% year-over-year.
Equity markets nevertheless posted solid gains, with the Shanghai Composite climbing 1.02% to 3,940.04 and the CSI 300 advancing 0.93% to 4,694.44 on expectations of further policy support. The Hang Seng Index rose 0.54% to 25,668.03 while the TAIEX edged 0.38% lower to 44,225.91. USD/CNY fell 0.17% to 6.74, reflecting modest capital inflows after the PBoC’s 398.5 billion yuan reverse-repo operation.
Copper prices advanced 0.99% to 6.64, signaling improved near-term demand expectations for mainland industry. Brent crude jumped 5.15% to 87.85 on supply concerns that could lift mainland import costs and widen the trade surplus. Gold surged 2.49% to 4,448.60, underscoring safe-haven flows that may support HKMA peg stability.
The Day Ahead
Attention turns to the August 14 preliminary current-account release, which will clarify the strength of mainland China’s external surplus after recent trade softness. On August 16, investors will receive the house-price index, industrial production, retail-sales and fixed-asset-investment figures, all of which are expected to show continued moderation in domestic demand. No policy meetings are scheduled for the HKMA or CBC this week.
PBoC liquidity operations remain the key near-term catalyst, with markets pricing in another sizable reverse-repo injection. Cross-strait semiconductor export data from Taiwan will also be monitored for any early signs of U.S. restriction effects.
Hong Kong’s record heatwave has not yet translated into measurable economic disruption, though tourism and retail operators remain cautious.
Other Economic Notes
Persistent consumer-price weakness reinforces the case for additional PBoC easing measures beyond the recent liquidity additions. Property-sector deleveraging continues to weigh on credit demand, with banks showing reluctance to expand lending amid rising defaults. Taiwan’s semiconductor supply chain has so far absorbed external demand shocks without visible order cancellations.
<i>↓ p.2</i>
