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Worldview: China Loans Plunge to 14-Year Low, Adding to Deflation Risk

This week’s global markets round-up of fashion business news also features Turkey’s retail sales rose 28.5 percent year on year in June, South Indian mills cut discounts amid rising cotton prices and 422 facilities are named on Pakistan Accord’s first supplier list.
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China loans plunge to a 14-year low. (Shutterstock)

🇨🇳 China loans plunge to 14-year low, adding to deflation risk. Credit demand in July was well below economists’ forecasts. This follows news that the country’s official consumer price index declined 0.3 percent in July. China had been on the cusp of deflation for several months as it faces soft demand, ongoing pressure in the real estate sector and high youth unemployment.

🇹🇷 Turkey’s retail sales rose 28.5% YoY in June. Retail sales volume measured in constant prices increased 28.5 percent year on year in June. In the same month, non-food (except automotive fuel) sales increased 32 percent. The country’s retail turnover increased 73 percent in June compared with the same month of the previous year.

🇨🇳 Alibaba’s sales beat estimates in first step of comeback effort. The China-based online commerce giant reported revenue of 234.16 billion yuan ($32.3 billion) for the quarter ended in June, versus average analyst estimates of 223.75 billion yuan. Net income came to 34.3 billion yuan, also ahead of estimates.

🇨🇳 China economic data in July disappoints. Retail sales rose by 2.5 percent in July from a year ago, below a 4.5 percent increase expected by analysts polled by Reuters. Unlike prior releases, this month’s data did not include youth unemployment figures, which soared to a record high of 21.3 percent in June. China’s official consumer price index fell by 0.3 percent in July slipping the country into deflation.

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🇮🇳 South Indian mills cut discounts amid rising cotton prices. Cotton yarn prices increased in Mumbai, while remaining steady in Tiruppur. South Indian mills are aiming to raise prices to counter a sharp increase in cotton costs and are cutting discounts. Gujarat’s cotton prices also rose.

🇨🇳 Hainan duty-free sales fall 34% in July. Offshore sales in China’s largest duty-free hub plunged 34 percent in July to 2.64 billion yuan ($366.2 million), customs data showed, reflecting a government crackdown in the second quarter on daigou, or the grey market traders. This came on the heels of a strong first quarter, driving up Hainan’s total duty-free sales from January through July to 28.93 billion yuan, a year-on-year increase of approximately 20 percent.

🇵🇰 422 facilities named on Pakistan Accord’s first supplier list. With over 65 global signatories including H&M, PVH, Fast Retailing and Asos, the workers’ safety programme now encompasses more than 400 factories in the country. Modelled on the legally binding International Accord for Health and Safety in the Textile and Garment Industry, the Pakistan Accord was unveiled in December 2022 and anticipates more suppliers to sign on to the programme in the coming weeks.

🇲🇽 US and Mexico reach a labour-rights agreement for Mexican denim factory. The two countries have agreed on a course of remediation to address allegations of union-busting at a denim factory in the Mexican state of Aguascalientes. Filed by Mexican labour organisation Frente Auténtico del Trabajo and the Sindicato de Industrias del Interior in May, the original complaint accused the denim facility of inappropriate involvement in internal union activities and hampering collective bargaining.

🇰🇷 Dior names K-pop group Tomorrow X Together brand ambassadors. After performing at a Chicago music festival in custom-designed Dior outfits, the K-pop group has been officially named ambassadors of the luxury house. Dior artistic director Kim Jones created the looks for members Soobin, Yeonjun, Beomgyu, Taehyun and Hueningkai as part of their 20-song concert, which was the first Korean group to headline the music festival.

🇯🇵 Levi’s taps Kaihara Denim Mills for ‘Made in Japan’ collection. The brand’s Autumn/Winter 2023 collection offers cuts and washes in the spirit of Japanese craftsmanship. This is part of Levi’s partnership with Kaihara Denim Mills, using the Hiroshima mill’s premium selvedge denim for the menswear and womenswear collections.

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