China March Official PMI Seen Contracting for Third Month (Reuters, Mar 30) China's official purchasing managers' index is expected to read 49.7 for March, according to the median view put forward by 19 economists polled by Reuters. In January, the widely-watched gauge of factory activity dipped below the 50-point mark which separates expansion from contraction for the first time in 2 and a half years.
China's Coal Use Falling Faster Than Expected (Reuters, Mar 26) Utilization rates at China's thermal power plants – almost all of which are coal-fired – dropped to 52.2% during the first two months of 2015, according to Reuters calculations. Utilization rates at such plants fell to a record low of 53.7% last year, down from 57.3% in 2013. Reuters figures showed power plants consuming 3.36 million tons of coal per day during January-February, down from daily averages of 3.66 million tons and 3.71 million tons in 2014 and 2013 respectively.
China's Big Banks Double Their Write-Offs (Marketwatch, Mar 29) China Construction Bank Corp reported a net profit of 227 billion yuan last year, up 6.1% from 2013. Yet it also wrote off 35.66 billion yuan in bad loans in 2014, compared with 16.7 billion yuan a year earlier. All together, China's 4 big state-run banks wrote off or transferred 128.98 billion yuan in loans last year, up from 52.11 billion yuan a year earlier. Without the write-offs though, non-performing loan ratios at these banks would reportedly have stayed below 2%.
China to Cut 80m Tons of Steel Capacity Over 2015-17: Official (Reuters, Mar 28) Authorities intend to pare down the number of steel enterprises operating in the country from the current 500 to “around 300” by 2017 as part of a plan to reduce capacity, according to an official with the Ministry of Industry and Information Technology. Earlier, the ministry announced that it would aim to consolidate 60% of total industry capacity under the 10 largest enterprises by 2025, a decade later than originally scheduled.
China January-February Industrial Profits Down 4.2% y-o-y, Worst Drop Since 2012 (Reuters, Mar 27) Industrial firms in China earned a combined profit of 745 billion yuan during the first two months, according to figures from the National Bureau of Statistics. An official with the bureau said that while a 5.5% drop in raw materials purchasing prices cut firms' costs by 564 billion yuan during the period, a 4.6% decline in factory-gate prices resulted in a 733 billion yuan revenue loss.
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