Goldman Sachs China Economic Activity and Policy Tracker: June 26
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Goldman Sachs China Economic Activity and Policy Tracker: June 26
The report updates four groups of high-frequency indicators covering consumption and travel, production and investment, other macro activity, and markets and policy, showing marginal divergence in China's economic activity: real estate and some logistics remain weak, while flights, port throughput, oil demand, and coal consumption provide some support, and policy continues to focus on boosting consumption, investment, and stable growth.
- Daily primary home sales in 30 cities edged up last week but remained below the level of a year ago, while daily secondary home sales in 16 cities declined last week and also remained below the level of a year ago.
- Domestic flight volumes increased last week but remained below the level of a year ago, while the flight cancellation rate declined slightly but stayed elevated; traffic congestion fell due to the Dragon Boat Festival holiday from June 19 to June 21.
- Steel demand and steel output both declined slightly last week, while daily coal consumption in coastal provinces remained range-bound and above the level of a year ago.
- Seasonally adjusted EPMI fell in June; official port container throughput rose slightly and was above the level of a year ago, but outbound cargo shipments from 20 major ports declined and were below the level of a year ago.
- Goldman Sachs' oil demand nowcast shows China's latest oil product demand reading edged up to 16.3mb/d; interbank repo rates continued to rise slightly, and the renminbi appreciated against the CFETS basket but depreciated against the U.S. dollar.
Report interpretation
Overview
This report is Goldman Sachs' weekly high-frequency tracker of China's economic activity and policy, covering four categories of indicators: consumption and travel, production and investment, other macro activity, and markets and policy. Through data on real estate transactions, flights, traffic congestion, tourism, industrial products, steel, coal consumption, special-purpose bonds, EPMI, ports, oil demand, repo rates, the renminbi exchange rate, and policy announcements, the report observes marginal changes in China's economic activity.
Core views
The core conclusion is that China's economic activity is neither improving nor weakening in a one-way manner, but is instead showing structural divergence. Some consumption and travel indicators improved at the margin but are still affected by holidays and year-over-year base effects; real estate transactions remain below the level of a year ago; among industrial production-related indicators, coal consumption remains relatively supported while steel demand and output are weak; foreign trade and logistics indicators are mixed; on the policy side, intensive measures continue to focus on expanding consumption, equipment upgrades, stabilizing foreign investment, urban renewal, the energy system, and stable-growth tools.
Analysis framework
The report uses a high-frequency indicator dashboard approach, grouping daily, weekly, and monthly data by theme, comparing changes versus the previous week and levels versus the same period last year, and assessing macro activity and policy bias in conjunction with recent policy announcements. The focus is not on giving a single forecast, but on capturing the latest marginal changes in economic momentum, policy support direction, and market variables through multi-source data.
Methodology notes
Four groups of high-frequency indicators
The report tracks four groups of indicators—consumption and travel, production and investment, other macro activity, and markets and policy—updated weekly to observe the impact of energy price shocks and changes in macro activity on China's economy.
The ratio of actual travel time to free-flow travel time
Traffic congestion is calculated as the ratio of actual travel time to free-flow travel time; a higher value indicates heavier congestion. Since 2022, the data source has switched from Amap to Baidu Maps, and sample coverage has been adjusted from 100 cities to 98 cities.
High-frequency estimate of oil product demand
Goldman Sachs' commodities research team uses a nowcast to provide a high-frequency measure of China's oil product demand, while the supply-demand balance table is typically updated only once every six weeks.
Changes in manufacturing-related activity after removing seasonality
The report notes that seasonally adjusted EPMI declined in June, helping assess momentum related to production and orders.
Asset mapping & comparison
Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).
- China macro assetsDirectly related
- Strengths
- Policy announcements remain frequent, and measures to stabilize growth, expand consumption, and support investment continue to advance.
- Weaknesses
- Real estate transactions, steel demand, and some logistics indicators remain weak, and the recovery in economic activity is uneven.
- Comparison
- Compared with single aggregate indicators, high-frequency data show more structural divergence.
- Risks
- Slower-than-expected policy implementation or larger external shocks could weaken risk appetite for macro assets.
- Real estate chainAn important negative drag
- Strengths
- Primary home sales in 30 cities edged up slightly last week.
- Weaknesses
- Both primary and secondary home sales remain below the level of a year ago, and secondary home sales also declined last week.
- Comparison
- Real estate performance is weaker than some activity indicators such as flights, oil demand, and port throughput.
- Risks
- Persistently weak transactions could weigh on building materials, steel, local government finances, and household confidence.
- Steel and industrial productsProduction- and investment-sensitive assets
- Strengths
- Coal consumption is above the level of a year ago, indicating that some electricity use and production demand remain supported.
- Weaknesses
- Steel demand and steel output both declined slightly, and seasonally adjusted EPMI fell.
- Comparison
- There is divergence within the industrial chain, with coal consumption relatively stronger than steel activity.
- Risks
- Insufficient demand from real estate and infrastructure could pressure steel and related industrial product prices.
- Energy and oil productsDemand-tracking indicator
- Strengths
- China's oil product demand nowcast edged up to 16.3mb/d, and coal consumption was also above the level of a year ago.
- Weaknesses
- Domestic gasoline and diesel prices were flat last week, while Brent prices continued to decline, indicating that the price side is not uniformly strengthening.
- Comparison
- Oil demand and coal consumption indicators are better than steel demand, but still need to be cross-checked against travel and industrial data.
- Risks
- Energy price supply shocks or errors in demand estimates could alter judgments on macro activity.
- Renminbi and interest ratesMarket and policy transmission variables
- Strengths
- The renminbi appreciated against the CFETS basket, indicating support at the basket-exchange-rate level.
- Weaknesses
- The renminbi depreciated against the U.S. dollar, while interbank repo rates continued to edge higher.
- Comparison
- Signals diverge between the exchange-rate basket and the bilateral USD exchange rate.
- Risks
- A stronger U.S. dollar, changes in capital flows, or tighter liquidity could affect expectations for the renminbi and interest rates.
- Consumption and servicesPolicy support direction
- Strengths
- Per capita tourism revenue during the Dragon Boat Festival was close to the level of a year ago, the number of domestic flights increased last week, and policy announcements repeatedly focused on auto consumption, AI-plus consumption, and trade-in programs for consumer goods.
- Weaknesses
- Consumer confidence declined last week, flights remained below the level of a year ago, and traffic congestion fell due to holiday disruption.
- Comparison
- Some service consumption indicators are better than real-estate-related demand, but confidence indicators remain weak.
- Risks
- Weak household income expectations, employment, and confidence may limit the multiplier effect of consumption policies.
Key data
- Primary home salesDaily transaction volume in 30 cities edged up last weekStill below the level of a year ago.
- Secondary home salesDaily transaction volume in 16 cities declined last weekStill below the level of a year ago.
- Domestic flightsDomestic passenger flights increased last weekStill below the level of a year ago; the cancellation rate declined slightly but remained elevated.
- Tourism consumptionPer capita tourism revenue during the Dragon Boat Festival was close to the level of a year agoIn 2026, the Dragon Boat Festival runs from June 19 to June 21, for a total of 3 days.
- Steel activitySteel demand and steel output both declined slightly last weekIndicating weak momentum in some industrial activity.
- Thermal coal demandDaily coal consumption in coastal provinces remained range-boundThe reading was above the level of a year ago.
- Local government special-purpose bondsRMB 1.87bn has been issued year to dateIssuance plans were updated through June 26.
- EPMIDeclined in June after seasonal adjustmentPointing to marginal weakening in production- and investment-related momentum.
- Port activityOfficial port container throughput rose slightly last weekAbove the level of a year ago; however, outbound cargo shipments from 20 major ports declined and were below the level of a year ago.
- U.S. soybean export sales to ChinaRemained low in the third week of JuneReflecting continued weakness in demand related to agricultural trade.
- China oil product demand16.3mb/dGoldman Sachs' latest nowcast reading edged higher.
- Market variablesRepo rates edged higher, and the renminbi appreciated against the CFETS basket while depreciating against the U.S. dollarThe countercyclical factor implied by the USDCNY fixing declined slightly last week.
Impact & implications
In terms of investment implications, the report suggests that tracking China's macro recovery should focus more on structure than aggregate growth: the real estate chain remains the main drag, coal consumption is stronger than steel within the industrial chain, consumer services are disrupted by holidays but some travel data have improved, and foreign trade/logistics indicators are inconsistent. Policy announcements are densely concentrated on consumption, investment, equipment upgrades, foreign investment, urban renewal, and the energy system, indicating that stable growth still depends on continued policy implementation. Changes in interest rates and exchange rates also suggest that liquidity and renminbi expectations still need to be monitored together.
Risks
- High-frequency indicators are easily affected by holidays, weather, sample adjustments, and weekly volatility, so single-week changes should not be over-extrapolated.
- Real estate transactions remain below the level of a year ago; if weakness persists, it could weigh on related industrial products, local government finances, and household confidence.
- Declines in steel demand, steel output, and EPMI indicate continued downside risk to production and investment momentum.
- Diverging signals between port throughput and outbound cargo shipments point to uncertainty in foreign trade and logistics momentum.
- Rising repo rates and renminbi depreciation against the U.S. dollar may affect market liquidity and risk appetite.
- A dense release of policy measures does not mean immediate effectiveness; the pace of execution and fund deployment still need to be verified.
What to watch
- Whether primary home sales in 30 cities and secondary home sales in 16 cities can continue to improve and narrow their year-over-year declines.
- Whether domestic flights, flight cancellation rates, traffic congestion, and tourism revenue can continue to recover after holiday-related disruptions.
- Whether steel demand, steel output, coastal coal consumption, and EPMI show consistent improvement.
- The follow-up issuance and implementation pace of local government special-purpose bonds, equipment upgrade projects, and funds for consumer goods trade-in programs.
- Foreign trade signals from port container throughput, outbound cargo shipments from 20 major ports, and U.S. soybean export sales to China.
- Changes in interbank repo rates, USDCNY, the CFETS RMB Index, and the countercyclical factor.