Greater China

Research evidence excerpt

Greater China

Feng Zhu (852) 2800 1745 Jiayi Li (852) 2800-5229 Asia Pacific Economic Research J P M O R G A Nfeng.zhu@jpmorgan.com jiayi.c.li@jpmorgan.com

JPMorgan Chase Bank, N.A., Hong Kong Branch 03 July 2026

Tingting Ge (852) 2800-0143 Tongfang Yuan (852) 2800-0085

tingting.ge@jpmorgan.com tongfang.yuan@jpmorgan.com

Greater China Manufacturing resilience may cushion growth and keep activ-

ity near target, but without stronger wages, household confi-

• China: resilient manufacturing and easing cost pres- dence and private-sector returns, it is unlikely to support a

sures in the June PMIs sustained recovery. On pricing, while the worst deflation con-

cerns may have eased, reflation remains narrow, cost-sensi-

• Solid but diverging industrial profits in May tive and dependent on whether stronger orders translate into

• Taiwan: June PMI still firm despite modest easing income, services demand and firmer domestic pricing power.

• Hong Kong: benign inflation, strong trade, and solid

retail sales in May Two-speed industrial profit growth

• Next week: China FX reserves, CPI, credit; Hong Headline industrial profits growth edged up to 18.8%oya ytd,

Kong PMI; Taiwan CPI and trade while the pace of expansion slightly moderated to 21.1%oya

in May (Figure 2). Sectoral performance continued to show a

China’s latest PMIs point to a mild demand recovery from the two-speed picture. Electronics (+103.9%oya ytd) and high-

April-May soft patch. That said, the recovery remains narrow tech (+44.7%) manufacturing profits outperformed on the

and weakly transmitted: employment, inventories and back- global AI upcycle and strong demand for memory chips.

logs still point to corporate caution, while softer export-order Energy-linked industries’ profits improved, with petro-pro-