Chinese Financial and growth risk weighing on AUD - AmpGFX
Greg Gibbs, Director at Amplifying Global FX Capital, explains that the recent AUD fall may also reflect a higher risk of slower Chinese economic growth and demand for steel.
Key Quotes
“Chinese policymakers set a stable growth target this year, earlier in March. Many anticipate that ahead of a 5-yearly re-shuffle in the leadership of the Chinese Communist Party in Autumn this year, economic stability will be more imperative that tackling excesses in debt, state-owned enterprises, over-capacity in heavy industries, and financial stability.”
“Nevertheless, Chinese policy makers have appeared to tighten policy somewhat in recent weeks and shift gear to slow rapid credit creation and property speculation in its major cities.”
“Chinese interest rates and corporate bond yields have risen, and there are reports of some more careful monitoring of shadow-banking activity.”
Author
Sandeep Kanihama
FXStreet Contributor
Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.
