China Weekly Dynamics

Latest edition · July 13, 2026

China Q2 data to show growth moderation

This report previews China's Q2 macroeconomic data, forecasting a moderation in real GDP growth to 4.6% alongside a turn to positive nominal growth. It also notes policy trends favoring continued CNY strength and potential supply-side pressures in the government bond market for Q3.

The report highlights that despite moderated real GDP growth to 4.6% in Q2, China is experiencing mild reflation, indicated by a positive GDP deflator pushing nominal growth to 7.0%. Trade performance remains resilient, though domestic demand headwinds persist, as seen in auto retail and home sales data. Looking ahead, authorities are expected to maintain a tolerance for CNY strength while monitoring the narrowing gap between the spot price and the fixing. Additionally, seasonal duration supply in government bonds and a potential pick-up in policy bank bond issuance suggest continued pressure on interest rates in Q3, provided the upcoming Politburo meeting does not announce major incremental stimulus.

Key takeaways from the latest edition

• 1.China's real GDP growth is forecasted to have moderated to 4.6% YoY in Q2, down from 5.0% in Q1.
• 2.Authorities are likely continuing to tolerate CNY strength and narrowing the spot-fixing gap.
• 3.Supply pressure on government bond rates is expected in Q3 due to seasonal duration supply and potential pick-up in PFBs.

What this series covers

• Macro: Growth divergence and policy implication
• Lowering USD/CNY fixing, supply pressure in rates
• Asset overview and flows
• Macro: Trade dynamics
• Macro: Demand and supply snapshot
• Macro: Prices and inflation
• Macro: monetary and fiscal condition
• FX market: Market dynamics
• FX market: Macro Fundamentals
• FX market: Forwards & options
• Fixed income market: Performance
• Fixed income market: Money market and liquidity
• Fixed income market: Primary market
• Fixed income market: Interbank bond holding
• Calendar

Edition archive

• China Q2 data to show growth moderation

  July 13, 2026

• PBoC’s debut overnight reverse repo

  June 29, 2026

• Macro weakness into June

  June 22, 2026