China's August real estate transactions dropped year-over-year and month-over-month.


In August, China's real estate transaction volume declined both year-on-year and month-on-month, personal income tax incentives extended by four years, and the NDRC will intensify macro policy regulation.

Market Review


Focus News

China Market

1. Transaction volume in the real estate market for August decreases both year-over-year and month-over-month

In August, the real estate market continued its decline trend in transaction volume both year-over-year and month-over-month. The transaction area in first-tier cities decreased overall, with a month-over-month drop of 22.83% and a year-over-year decrease of 32.21%. Among them, Shanghai experienced the largest decline among first-tier cities, decreasing 28.9% month-over-month and 39.8% year-over-year. Additionally, the transaction area in second-tier representative cities increased by 3.15% month-over-month but decreased by 31.39% year-over-year. The transaction volume in representative cities of the third and fourth tiers saw a month-over-month decrease of 8.77% and a year-over-year fall of 21.8%.

2. The personal income tax incentive policy extended for another four years

To further alleviate the tax burden on taxpayers, the Ministry of Finance and the State Taxation Administration announced the extension of the annual one-time bonus personal income tax policy until the end of 2027. Resident individuals can choose to calculate tax separately or include it in their comprehensive income, with the two tax calculation methods potentially differing by tens of thousands.

Overseas Market

1. US medium and short-term Treasury yields auction rates hit a multi-year high

According to data released by the US Treasury Department, the auction rate of two-year US Treasuries broke through 5% for the first time since 2006, and the winning rate for five-year US Treasuries hit a new high since 2007. Following Federal Reserve Chairman Powell's revelation at last week's Jackson Hole central banking conference, prepared to further hike rates when appropriate, the multi-year high auction rates of two-year and five-year US Treasuries indicate investors' expectations for continued Fed rate hikes within the year are heating up. Financial institutions predict that with loan shortages and short-term deposit contractions, economic activity and inflationary pressures may cool to varying degrees.

2. Eurozone money supply contracts for the first time in thirteen years

Latest data shows that the eurozone's loan growth rate to the private sector in July fell to 1.6%, the lowest since 2016, and lending to governments decreased by 2.7%, marking the biggest drop since 2007. Money supply growth is commonly a key indicator of economic activity and a measure of whether a recession is imminent.

3. Australian gas plants could go on strike as early as September 7

Chevron stated in an email announcement that unions have notified if Chevron cannot reach an agreement with workers, the company's Gorgon and Wheatstone gas plants in Australia could start strike actions as early as September 7. Since early August, the threat of strikes has thrown the global natural gas market into turmoil, with Chevron's Australian plants accounting for 5% of global natural gas supply.

4. ECB's "Hawk King" suggests a possible rate hike again in September

Robert Holzmann, a member of the ECB's Governing Council, stated that the central bank has not yet defeated inflation and might need to hike rates again in September. Holzmann has always been one of the most hawkish policymakers, and his latest viewpoint aligns with other hawkish colleagues advocating for another rate hike. At the Jackson Hole conference last week, German Central Bank President Joachim Nagel and Latvian Central Bank President Martins Kazaks both expressed a tendency to hike rates again.

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