China released its latest economic data this week, and at first glance, inflation has picked up slightly, while international trade continues to struggle. At the same time, monetary supply and bank lending figures suggest that banks have become more accommodative. While these trends indicate that stabilisation of the economy could be underway, concerns of the leveraging nature of the economy and size of non-performing loans (NPLs) linger.

China announced the full-year results of a number of key economic indicators for 2015 (see Table 1). While some of these indicators have fallen short of targets laid out in March 2015, the combination of lower-than-expected inflation, robust growth of the tertiary sector, and improved trade surplus has helped stabilize the economy and kept its headline growth rate intact. Although we do not expect any V-shape growth rebound in 2016, a more proactive approach of fiscal spending and effects of expansionary monetary measures should help stabilize the Chinese economy.

While strolling around Central recently, I snapped up a few shirts for Chinese New Year. I may have got a bargain, but the exceptionally sweet deal makes me worry about the retail sector’s coming prospects.

The U.S. Federal Reserve raised its benchmark interest rate from the 0-0.25% range to 0.25-0.5% on 16 December. On the back of steadily recovering economic momentum and a stronger labour market, the move marks the end of a seven-year period with close-to-zero interest rate.

The International Monetary Fund (IMF) completed its review of the basket of currencies for the Special Drawing Right (SDR) and included the Chinese renminbi (RMB) for the first time. Effective 1 October 2016, as the fifth currency – after the US Dollar, euro, British pound, and Japanese yen – the RMB will be part of the SDR basket.

Shortly after the Fifth Plenary Session of the 18th CPC Central Committeeconcluded on 29October, the Central Government released "The CPC Central Committee's Proposal on Formulating the Thirteenth Five-year Plan (13th FYP, 2016-2020) on National Economic and Social Development"(the Proposal) on 3 November. The Proposalcovers the details and the chain of thought of the Central Government in various areas, from protecting agricultural land and accelerating financial reform to the opening up of the Chinese economy.

After recording 7%YoY growth in the first half of 2015, China’s third quarter GDP growth dipped slightly to 6.9%YoY, the slowest quarterly growth since the first quarter of 2009, when the economy grew 6.2%.