In Depth: China’s Polysilicon Majors Plan to Bail Out Rest of Glut-Stricken Industry

CPI decline breaks: A rebound in industrial consumer goods prices drove a slight uptick in China’s consumer price index (CPI) in June. The 0.1% year-on-year rise ended four consecutive months of decline, marking a 0.2-percentage-point increase from May, according to official data released Wednesday. Growth in the core CPI, which excludes volatile food and energy prices, accelerated by 0.1 percentage points to 0.7%, hitting a level not seen since April 2024. The producer price index continued to slide, falling 3.6% year-on-year, its sharpest decline in nearly two years. The larger-than-expected drop was fueled partly by cheaper energy costs and the global trade slowdown, which increased downward pressure on prices in export-heavy industries.

Bond Connect expands: The southbound channel of the Bond Connect plans to expand the access available to domestic investors as part of efforts to further open China’s bond market, the People’s Bank of China (PBOC) and the Hong Kong Monetary Authority (HKMA) announced Tuesday. Four types of nonbank institutions on the mainland will be able to invest in the Hong Kong bond market through this channel: securities firms, funds, insurers, and wealth management firms. This will help mainland investors diversify asset allocation, while improving market liquidity and Hong Kong’s attractiveness to bond issuers and global investors, HKMA Chief Executive Eddie Yue said. The PBOC also announced plans to optimize the offshore repurchase business mechanism under Bond Connect and the operating mechanism of the Swap Connect.

AI startup gets fresh funds: Chinese embodied artificial intelligence (AI) startup Tars has raised $122 million in a second round of angel financing, the company announced. The angel+ round comes just five months after Tars was founded in February. The fundraising was led by Meituan’s strategic investment arm. Tars raised $120 million in its first funding round. The startup has yet to launch a product, but it claims to be able to develop large models for embodied intelligence and mass-produce integrated hardware and software products. It has become difficult for startups to attract capital in the embodied AI niche, according to investors, but Tars has the benefit of a strong leadership team, which includes former heads from the intelligent driving divisions of Baidu Inc. and Huawei Technologies Co. Ltd.

Excavator demand piles up: China’s excavator sales rose 13.3% year-on-year in June, driven by strong exports and a push to meet half-year targets. The increase signals a recovery in the construction equipment market despite continued weakness in real estate and low machine utilization. Domestic sales increased 6.2% to some 8,100 units and exports by 19.3% to 10,700 units, according to industry data released Monday. Excavator sales are a window for observing the prosperity of the real estate and infrastructure industries. The sales volume of construction machinery declined in tandem with the property sector from mid-2021 before bottoming out last year. In the first quarter of this year, domestic excavator sales maintained a growth trend.

Taiwan firms face export controls: China’s commerce ministry has placed eight Taiwanese entities including aerospace and shipbuilding companies on its export control list. All exports of dual-use — military and civilian — items to the sanctioned entities are prohibited, the ministry said in a statement Wednesday. Any ongoing related export activities shall be immediately suspended, the statement said.