Recently, the People's Bank of China (PBOC) introduced several supportive measures, including lowering the reserve requirement ratio (RRR), cutting interest rates, and reducing mortgage rates for existing loans. These moves aim to boost economic recovery, especially in sectors like real estate and consumption. As a result, China-concept stock ETFs present a compelling investment opportunity.Key Monetary Policy ChangesThe PBOC announced a 0.5 percentage point cut in the RRR, with another possible reduction by year-end. Policy rates, such as the 7-day reverse repo rate, have been cut by 0.2 percentage points, while mortgage rates and down payment requirements for second homes have also been lowered. These measures will increase liquidity, benefiting sectors like real estate and consumption.I

1. China’s consumer price index (CPI) fell 0.3% in December, slightly better than the 0.4% decline expected by the market. It’s the third straight month of negative CPI growth, pointing to deflation that’s not getting worse but becoming stickier. China’ Producer Price Index (PPI) for the month fell 2.7%, slightly worse than the 2.6% decline expected. #inflation2. China’s exports for December grew at a faster-than-expected rate of 2.3% year-on-year vs. consensus estimates of only 1.5%. Imports also grew 0.2%, which was better than consensus estimates of an 0.5% decline. This resulted in a trade surplus of $75.34 billion, higher than expectations of just $74.95 billion. Despite both exports and imports declining for the full year, China’s trade surplus remained relatively steady at $823 bill

1. China’s major cities report a jump in transactions after the latest round of easing measures. The 30 biggest cities in China reported a 6% week-on-week bump in new home sales last week driven primarily by strong demand in key cities. Beijing and Shanghai witnessed a respective 122% and 41% spike in average daily sales. Both cities reduced the minimum downpayment requirement and mortgage rates for new and second home purchases last week. While still relatively high at 30% to 40%, lower downpayment requirements are attracting wealthier buyers back into the best markets in China. $Global X MSCI China Real Estate ETF(CHIR)$ $China Resources Land Ltd.(CRBJF)$ $Countr

1. Money supply growth in China grew at a slower-than-expected rate in November. China’s money supply as measured by M2 grew by 10% in November, which was slightly slower than the 10.1% growth expected by the market. It was a deceleration compared with the 10.3% growth logged in October. At the same time, aggregate financing to the real economy last month reached RMB 2.45 trillion, which was slightly lower than the RMB 2.43 trillion expected by the market. These lower than expected measures of liquidity lines up with negative inflation readings on both CPI and PPI metrics in November, while supporting the need for stronger stimulus to bring confidence back into the general economy. $KraneShares Bosera MSCI China A 50 Connect Index ETF(KBA)$

1. China’s central bank acts modestly to keep banking system liquidity adequate through reverse repos. The People’s Bank of China (PBoC) conducted RMB 240 billion worth of 7-day reverse repurchase (repo) agreements with commercial banks today at a rate of 1.8%. That was unchanged from the reverse repo the PBoC did yesterday worth RMB 210 billion. These are considered elevated levels of reverse repos based on historical transactions and indicates Beijing’s willingness to sustain the current policy of easing liquidity to help the economy. In October, loan growth in China clocked in at 10.9%, which was well below the long-term average growth of 15.3%. That’s a reflection of weak confidence in the private sector, possibly influenced by the ongoing bear market in real estate.

1. China’s November Caixin Services PMI reading accelerated again in a positive sign for the economy. The November reading for the private-sector-driven Caixin Services PMI was 51.5, beating market forecasts of just 50.5, and significantly better than the 50.4 reading in October. This is the second month of acceleration in China’s services industry. It’s also the first better-than-expected reading since July, as the services sector escaped contraction this year. Meanwhile, the Caixin Manufacturing PMI for November came in at 50.7, which was higher than the 49.3 contraction level expected by the market. It was an improvement from the 49.5 reading in October and signaled the first improvement since August. These figures point to expanding activity in key sectors of the economy despite linger

1. China’s benchmark stock market index expected to change to include more tech firms. The compiler of the CSI 300 Index, China’s main stock index similar to the S&P 500, will be adding technology-related companies as part of its bi-annual review. The move is seen as an attempt to allow the main index to better reflect China’s changing economy, which is being driven by technological changes from chip manufacturing to AI and cloud computing. Chip industry leaders Cambricon Technologies, Empyrean Technology and Hygon Information Technology will be joining the CSI 300 Index starting December 2023. As it stands, the CSI 300 Index is heavily weighted in favor of financials and consumer staples, with information technology accounting for just 11.2% of the index. That contrasts with the S&

1. China’s inflation came in lower than expected in October, fanning worries of deflation once again. The October consumer price index (CPI) fell 0.2% year-on-year compared with an expected 0.1% decline. That also compared with a slight 0.1% gain in the CPI for September 2023, which points to softening prices across the board. Producer price index (PPI) fell 2.6% year-on-year, a worsening from the 2.5% decline suffered in September, as China’s manufacturing sector struggles with a more challenging global and domestic demand. Shortly after the CPI data came out, news hit the wires of various directors from China’s National Administration of Financial Regulation rushing to meet this afternoon. Beijing is under enormous pressure to stimulate domestic demand.