Market Review
Market Focus
Chinese Market
1. Data Shows August Passenger Car Retail Sales Reach Historical Peak for the Period
Benefiting from the continuous high demand for summer travel and consumption stimulus policies driving consumer demand, August car retail sales reached the highest level for the period in history. The Passenger Association's August national passenger car market analysis report shows that retail sales of passenger cars in August 2023 reached 1.92 million units, not only setting a new record for this period but also growing by 2% compared to the retail peak in August 2017.
2. Torrential Rains in Shenzhen and Hong Kong Break Multiple Records
Affected by the peripheral remnants of Typhoon "Khanun" and the monsoon, several rivers in Guangdong have experienced significant rise in water levels, with heavy rainfall expected to continue. Especially in Shenzhen, where torrential rains broke seven historical records! In Hong Kong, continuous heavy rains have caused severe flooding in many areas, with vehicles submerged and residents stranded by floodwaters.
Overseas Markets
1. Federal Reserve's Internal Model Shows Victory Over Inflation
An internal model of the Federal Reserve suggests that aggressive interest rate hikes have defeated inflation, potentially enabling the U.S. economy to achieve a soft landing. Economists at the Chicago Fed believe that the impact of this round of rate hikes is expected to occur not only faster but also to a greater extent than usual, meaning the yet-to-be-felt effects may still be significant enough to bring U.S. inflation quickly close to target.
2. Federal Reserve Increasingly Confident in Avoiding Recession
Given that U.S. economic data over the summer has shown resilience, the Federal Reserve appears to be increasingly confident in achieving the historically rare feat of a "soft landing", controlling inflation while avoiding recession. The New York Fed has restarted its real-time GDP tracking model (Nowcast) after a two-year pause, currently projecting a growth rate of about 2.2% for the third quarter. The Atlanta Fed's unofficial model predicts US GDP growth at an annualized rate of 5.6% for the third quarter.
3. US Used Car Prices May Have Bottomed Out
According to Cox Automotive, the largest automotive online to offline (O2O) trading platform in the United States, Manheim's Used Vehicle Value Index rose by 0.2% to 212.2 in August, marking the first increase since March (see below). Analysts believe that U.S. wholesale used car prices may have bottomed out this year. A potential strike by the United Auto Workers (UAW) against General Motors, Ford, and Stellantis over labor contract disputes could push U.S. used car prices back up, posing a renewed threat to inflation trends.
4. Russian Oil Export Prices Steadily Exceed G7's Price Cap
Russian official documents show that the macroeconomic forecast for 2026 submitted by Russian Prime Minister Mishustin expects the average price per barrel of exported crude oil this year to be $62.70, possibly rising to $66.30 next year, and to $67.9 and $69.8 in 2025 and 2026, respectively. According to this estimation, Russia's annual export price this year is 4.5% higher than the G7's price cap of $60, and the increase in the following three years will be even greater. By 2026, Russia's export price of crude oil will have risen by 11.3% from this year, 16.3% higher than the G7's cap.
