The People's Bank of China. Photo: Wikimedia Commons

The People’s Bank of China (PBoC), the country’s central bank, said there was no foundation for persistent inflation or deflation in China, which was hit by the Covid-19 pandemic in the first quarter.

China’s economic performance had remained generally stable while the overall supply and demand generally struck a balance, according to the first-quarter monetary policy report published by the PBoC.

The pandemic may continue to disrupt consumer prices from both the demand and supply sides in the short run, said the central bank, adding that it will closely monitor the situation.

It vowed to step up counter-cyclical adjustment to support the real economy, make the prudent monetary policy more flexible and appropriate, and continue to deepen market-oriented interest rate reform and reform on the yuan exchange rate formation system.

The consumer price index, the main gauge of China’s inflation, grew 4.3% year on year in March, moderating from 5.2% in February and 5.4% in January as economic activities including transport and logistics gradually recovered after the effective containment of the virus in most of the country.

Economic growth

China’s economy will continue to rebound in the second quarter, but the recovery pace may be constrained by external uncertainties and a global downturn, said some economists. Stronger supportive policies are needed to ensure a steady recovery for the rest of the year, they said.

April’s economic data will suggest that the Chinese economy is on a strong rebound trajectory, but major economic indicators could still be weaker than the same period of last year, said Wang Tao, chief China economist at Swiss bank UBS.

“We expect policy support to further intensify and the government to substantially increase fiscal spending to the level of around 2.2% of GDP,” Wang said in a research note.

China’s policy has so far been relatively mild compared with the massive economic stimulus package it adopted after the 2008 global financial crisis.

The authorities are scheduled to release key economic data for April this week including industrial output, inflation, retail sales and fixed-asset investment. More detailed economic policies are expected to be announced during the annual session of the National People’s Congress, China’s top legislature, which will open on May 22.

Raw material of masks

Sinopec Yizheng Chemical Fibre, a subsidiary of China’s largest oil refiner Sinopec, put into operation the 12th of its 12 meltblown non-woven fabric production lines Saturday to meet the brisk demand for face mask producers.

Sinopec has now completed the construction of all its 16 production lines for the fabric. After the full operation of the 16 production lines and together with Sinopec’s joint venture enterprises that can produce seven tonnes of meltblown non-woven fabric every day, the daily production capacity of the company is expected to reach 37 tonnes, and its annual production capacity will exceed 13,500 tonnes, which can be used to make 13.5 billion medical masks.

As the essential material to make masks, the non-woven fabric is the core raw material that serves as the filtering layer in the middle part of masks to absorb dust, bacteria and pollen.

Company news

Chinese carmaker Geely sold 105,500 vehicles in April, up 44% from the previous month, or 2% from the same period last year.

In the first four months of this year, Geely sold 311,500 cars and completed 22% of its annual sales target.

Huawei Technologies, a Shenzhen-based technology company, said it had set up a “5G automobile ecosphere,” aimed at accelerating 5G’s commercial use in the auto industry.

The “5G automobile ecosphere” is a result of cooperation between Huawei and 18 automakers, including the First Automobile Group, Chang’an Automobile, Dongfeng Motor Corporation, SAIC Motor Corporation, Guangzhou Automobile Group, BYD Auto, Great Wall Motors, Chery Holdings and JAC Motors.

Huawei plans to enlarge its advantage in the 5G field and exploit the car-to-internet market by providing automakers with vehicle-mounted 5G module MH5000 units and car-carried terminal T-Box and services, according to the Securities Times.

The story was written by Yang Zhijie and first published at ATimesCN.com.