# China’s patchy COVID easing sows confusion but comforts investors
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2022-12-05
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: China's COVID-19 Curbs Easing Amid Global Investor
Meta Description: Amid partial easing of strict measures, China faces mixed reactions as analysts predict potential earlier-than-expected reopening and economic recovery.
URL: https://financedigest.com/chinas-patchy-covid-easing-sows-confusion-but-comforts-investorshtml

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By Ryan Woo and Martin Quin Pollard

BEIJING (Reuters) -A partial easing of the world’s toughest COVID-19 curbs sowed confusion across China on Monday, even as global investors cheered the prospects of a broader policy shift in the wake of last month’s historic protests and mounting economic damage.

Three years into the pandemic, China’s zero-tolerance measures, from shuttered borders to frequent lockdowns, contrast sharply with the rest of the world, which has largely decided to live with the virus.

The strict approach has battered the [world’s second-largest economy](https://www.financedigest.com/at-chinas-largest-trade-fair-exporters-worry-about-world-economy.html "At China’s largest trade fair, exporters worry about world economy"), put mental strain on hundreds of millions and last month prompted the biggest show of public discontent in mainland China since President Xi Jinping took power in 2012.

Although the protests largely petered out amid a heavy police presence across major cities, regional authorities have cut back on lockdowns, [quarantine rules](https://www.financedigest.com/stocks-advance-u-s-dollar-retreats-as-china-drops-quarantine-rule.html "Stocks advance, U.S. dollar retreats as China drops quarantine rule") and testing requirements to varying degrees.

China will also soon announce a nationwide easing of testing requirements, allowing some [positive cases](https://www.financedigest.com/italy-probes-meta-over-abuse-of-position-in-music-rights-case.html "Italy probes Meta over abuse of position in music rights case") and close contacts to isolate at home, people familiar with the matter told Reuters last week.

That has prompted some analysts to suggest [China may drop](https://www.financedigest.com/bentley-cruises-to-record-sales-in-2022-despite-china-drop.html "Bentley cruises to record sales in 2022 despite China drop") border controls and re-open the economy sooner than expected.

The [risk of an earlier but managed exit has increased,” Goldman Sachs chief China](https://www.financedigest.com/asia-shares-weigh-china-risks-yen-hits-6-month-high.html "Asia shares weigh China risks, yen hits 6-month high") economist Hui Shan said in a note on Monday, adding that the bank expected such a reopening from April. Other analysts [expect such moves later in the year](https://www.financedigest.com/twenty-years-cash-isas-uk-fallen-short-expectations-alternatives.html "Twenty years on, cash ISAs in the UK have fallen short of expectations: what are the alternatives?").

But the lack of clarity leaves some in [China scared of being caught on the wrong side of fast-changing rules](https://www.financedigest.com/sterling-slips-as-boost-from-new-china-covid-rules-fades.html "Sterling slips as boost from new China COVID rules fades").

Yin, who [lives in a small city near](https://www.financedigest.com/mull-it-over-living-near-the-uks-best-christmas-markets.html "Mull it over: Living near the UK’s best Christmas markets") Beijing, the capital, said her in-laws had come down with a fever and she herself now had a sore throat, but they did not want to be tested for fear of being thrown into government quarantine facilities.

“All we want is to recover at home, by ourselves,” she told Reuters, speaking on condition of anonymity.

The yuan currency firmed to its strongest level against the dollar since mid-September amid a broad [market rally](https://www.financedigest.com/jittery-markets-attempt-risk-on-rally-while-waiting-for-powell.html "Jittery markets attempt risk-on rally while waiting for Powell") as investors hope the unwinding of pandemic curbs will brighten the outlook for global growth.

[Economic data](https://www.financedigest.com/oil-slumps-on-economic-data-stronger-u-s-dollar.html "Oil slumps on economic data, stronger U.S. dollar") underscored the damage from the curbs, as services activity shrank to six-month lows in November.

But in another hopeful sign for business, a source at Apple supplier Foxconn told Reuters the firm expected its COVID-hit Zhengzhou plant – the [world’s biggest iPhone factory – to resume full production later this month or early the next](https://www.financedigest.com/whats-coming-next-in-the-clearing-and-settlement-world.html "What’s coming next in the clearing and settlement world?").

CHANGING MESSAGE

Alongside the [easing of local curbs](https://www.financedigest.com/oil-hits-3-week-high-as-china-eases-covid-curbs.html "Oil hits 3-week high as China eases COVID curbs"), Vice Premier Sun Chunlan, who oversees COVID efforts, said last week the ability of the virus to cause disease was weakening.

That change in messaging aligns with the position held by many health [officials around the world for more than a year](https://www.financedigest.com/hong-kong-finance-official-to-make-first-visit-to-britain-in-three-years.html "Hong Kong finance official to make first visit to Britain in three years").

As the virus weakens, conditions are improving for China to [scale back](https://www.financedigest.com/mifid-ii-why-you-should-not-scale-back-your-implementation-efforts.html "MIFID II: WHY YOU SHOULD NOT SCALE BACK YOUR IMPLEMENTATION EFFORTS") management of COVID-19 as a serious contagious disease, state media outlet Yicai said late on Sunday, in comments that are among the first to float the idea.

In recent days, [major cities across China](https://www.financedigest.com/keysource-awarded-major-contract-to-design-nationwide-network-of-data-centres-throughout-china.html "KEYSOURCE AWARDED MAJOR CONTRACT TO DESIGN  NATIONWIDE NETWORK OF DATA CENTRES THROUGHOUT CHINA") have continued to loosening the toughest of those measures.

Authorities in the southwestern municipality of Chongqing urged local bodies not to test too much. Do not [repeat testing or increase](https://www.financedigest.com/how-to-increase-repeat-purchase-rates-in-ecommerce.html "How to increase repeat purchase rates in eCommerce") testing,” they said.

The eastern province of Zhejiang said it planned to largely end mass testing, while the metropolis of Nanjing dropped [COVID tests](https://www.financedigest.com/china-arrivals-in-uk-next-week-will-not-face-compulsory-covid-tests-independent.html "China arrivals in UK next week will not face compulsory COVID tests -Independent") for use of public transport.

So has Beijing, though entry to many office buildings in the capital still requires negative tests, [leaving workers](https://www.financedigest.com/more-than-half-of-workers-are-open-to-leaving-their-current-employers.html "MORE THAN HALF OF WORKERS ARE OPEN TO LEAVING THEIR CURRENT EMPLOYERS") confused.

The scrapping of the requirement for negative tests to [buy medicines for cold and fever in various cities](https://www.financedigest.com/4-for-the-price-of-1-what-you-can-buy-in-the-uks-top-northern-cities-for-the-price-of-a-london-pad.html "4 for the price of 1: What you can buy in the UK’s top northern cities for the price of a London pad"), intended to deter people from using the drugs to disguise symptoms, has led instead to mass buying, some state media said.

Daily tallies of new [COVID infections have also dropped in some regions as authorities row back](https://www.financedigest.com/fda-advisers-back-the-same-covid-vaccine-for-initial-shots-boosters.html "FDA advisers back the same COVID vaccine for initial shots, boosters") on testing.

Although the heat of last week’s protests appears to have died down, frustration can occasionally boil over.

In the central city of Wuhan, where the virus first emerged in late 2019, people [pushed down barriers on Saturday to break out of a lockdown at a garment industrial](https://www.financedigest.com/eu-recovers-appetite-for-trade-in-green-industry-push.html "EU recovers appetite for trade in green industry push") park, video clips posted on Twitter showed.

Reuters was able to verify that the incident happened in Wuhan.

On a rain-soaked Sunday, dozens of students carrying umbrellas gathered at a city university to protest its COVID policies, demanding greater “transparency” by officials, according to [videos widely shared](https://www.financedigest.com/ubisoft-shares-slump-20-after-french-video-game-maker-warns-on-revenue.html "Ubisoft shares slump 20% after French video game maker warns on revenue") on Twitter.

(Reporting by Ryan Woo, Bernard Orr and Martin Quin Pollard in Beijing; Writing by John Geddie; Editing by Clarence Fernandez)


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