China Beige Book, a survey of more than 1,400 Chinese companies conducted in February, showed on Monday, the coronavirus epidemic has hit China’s major industries and will lead to a contraction in GDP in the first quarter.
31% of CEOs saying that their company is still suspended for companies that have resumed work, 32% have employees working from home and 7% of employees waiting to return to work at work.
Only one-third of Chinese companies have resumed work.
First time in seven years that all data are negative and revenue, profits, orders and production are all in “free fall.”
About 40% of companies’ sales have fallen by more than 10% each major economic sector is contracting.
Leland Miller, CEO of China Beige Book noted: “The situation in (China) is much more serious than what the media have reported.”
With the risk recovery gathering momentum in Asia, the region’s equities are bouncing back while S&P 500 futures are up almost 1%. USD/JPY extends the bounce from 107.25 beyond 108.00 while the Aussie holds the recovery gains well above the 0.65 handle.
The improvement in the risk sentiment could be likely associated to the increased expectation of a global stimulus by major central banks, which is seen as a coordinated effort to battle the negative economic impact of the coronavirus outbreak.