China's NBS: Impact of Middle East conflicts on China is relatively small

Sagar Dua FXStreet

China’s National Bureau of Statistics (NBS) deputy head has stated during the Asian trading session on Thursday that the economy has started 2026 on a promising note despite a severe external environment that is hard won. These comments came after the release of the Q1 Gross Domestic Product (GDP) data, which showed that the economy grew at a faster-than-expected pace of 5% Year-on-Year (YoY).

Remarks

Impact on China's economy from global oil price volatility is relatively small.

Recovery in China's producer prices will have a positive impact on corporate profits.

Improving produce prices are driven by both changes in domestic supply and demand and higher global oil prices.

Middle east conflict will have some impact on China's exports.

China able to maintain relatively fast economic growth despite Middle East conflict.

China's economy faces some difficulties and challenges as global uncertainties are expected to increase

Domestic demand contributed to 84.7% of Q1 GDP growth.

Economic Indicator

Gross Domestic Product (YoY)

The Gross Domestic Product (GDP), released by the National Bureau of Statistics of China on a monthly basis, is a measure of the total value of all goods and services produced in China during a given period. The GDP is considered as the main measure of China’s economic activity. The YoY reading compares economic activity in the reference quarter compared with the same quarter a year earlier. Generally speaking, a rise in this indicator is bullish for the Renminbi (CNY), while a low reading is seen as bearish.

GBP/USD nudges higher above 1.3350 despite Middle East turmoil

The GBP/USD pair rebounds to near 1.3385 during the Asian trading hours on Thursday. However, the potential upside for the major pair might be limited amid cooler-than-expected UK inflation data and escalating tensions in the Middle East. Traders will take more cues from the UK Retail Sales report, which is due later on Friday.

EUR/USD stabilizes near 1.1400 as markets focus on geopolitics

EUR/USD trades in a narrow channel at around 1.1400 on Wednesday. In the absence of high-impact data releases, escalating geopolitical tensions in the Middle East caps the pair's upside. On Thursday, the European Central Bank (ECB) will announce monetary policy decisions.

Gold is at a critical juncture as Middle East conflict widens

Gold snaps a four-day recovery early Thursday as widening Mideast conflict-led rallying Oil prices spur inflation fears. The US Dollar stays defensive amid potential USD/JPY sell-off, as ‘Yenternvention’ risks loom. Gold at a crossroads, awaiting Bear Cross confirmation on the daily chart, as RSI flirts with 50.

Australia unemployment rate set to steady at 4.4% in June, signaling strong job market

Australia will publish the June monthly employment report on Thursday at 01:30 GMT, and market participants expect a modest increase in job creation in the land Down Under. The Australian Bureau of Statistics is expected to announce that the country added 15K new jobs in the month, while the Unemployment Rate is forecast at 4.4%, unchanged from May.

Senate Republicans release updated CLARITY Act with new crypto ethics restrictions

Senate Republicans released an updated version of the Digital Asset Market CLARITY Act on Wednesday following briefing calls with stakeholders. The update adds a package of ethics restrictions targeting digital asset activities by public officials and their spouses. The revised legislation comes after negotiations between the White House and Republican senators Cynthia Lummis and Bernie Moreno.

US Dollar mid-year outlook: Exceptional currency, exceptional risks?

The US Dollar enters the second half of 2026 in a markedly different position from a year ago. The King currency has recovered, reflecting persistent US inflation, changing expectations for Fed policy, geopolitical tensions and renewed demand for defensive assets.