China’s EV "overcapacity" is fallacy: official

The theory of so-called "overcapacity" of China's new energy industry is in fact a fallacy, which not only fails to meet reality, but also goes against the law of market economy development, a senior official with the General Administration of Customs said on Tuesday.

Zhao Zenglian, deputy chief of the General Administration of Customs, made the statement at a press conference in Beijing to deny the claim hyped up recently that there is so-called "excess capacity" of China's new energy industry.

"Green has become the distinctive undertone of high-quality development in foreign trade. Four out of every ten cars exported by China are electric vehicles, and seven out of every ten rail locomotives exported by the country are electric. Besides, nearly 90 percent of the batteries exported by China are lithium batteries. Recent claim of so-called 'overcapacity' in China's new energy industry is a fallacy. Such a theory is inconsistent with reality and also contradicts the principles of market economy development. Take electric vehicles as an example. According to estimates by the International Energy Agency, global electric vehicle sales are projected to reach around 45 million units annually by 2030. This number is three times the global sales in 2023 and five times that of China's production. Far from being in surplus, China's new energy products are contributing significantly to the global green supply, thereby contributing China's strength to combating climate change worldwide," he said.

China’s EV "overcapacity" is fallacy: official

The U.S. Federal Reserve on Wednesday slashed interest rates by 50 basis points amid cooling inflation and a weakening labor market, marking the first rate cut in over four years.

"The Committee has gained greater confidence that inflation is moving sustainably toward 2 percent, and judges that the risks to achieving its employment and inflation goals are roughly in balance," the Federal Open Market Committee (FOMC), the central bank's policy-setting body, said in a statement.

"In light of the progress on inflation and the balance of risks, the Committee decided to lower the target range for the federal funds rate by 1/2 percentage point to 4-3/4 to 5 percent," the FOMC said.

This signals the start of an easing cycle. Starting from March 2022, the Fed had raised rates consecutively for 11 times to combat inflation not seen in forty years, pushing the target range for the federal funds rate up to between 5.25 percent and 5.5 percent, the highest level in over two decades.

After maintaining rates at the high level for over a year, the Fed's tight monetary policy faced pressure to pivot due to the easing of inflationary pressures, signs of weakening in the job market, and slowing economic growth.

U.S. Fed slashes rates by 50 basis points, first rate cut in four years