Growth slowdown concerns in China are the main catalyst for the global equity market weakness. Firstly, China announced that they are raising gasoline and diesel prices that refiners can charge and thus higher prices will flow thru to the consumer. On one hand it reflects some comfort that officials have in the recent drop in CPI but on the other it will have an obvious impact on spending. Secondly, speaking in Australia, an exec of BHP said about China, “steel growth rates will flatten, and they have flattened” but they still see “positive growth out to the middle of the next decade.” Also and exec with Rio said this, “the rate of GDP growth in China is more immediately slowing.” Lastly, an official with the China Assoc of Auto Mfr’s, who has an 8% vehicle sales growth estimate for 2012 said they may not even get to 5% growth. The Shanghai index closed down by 1.4% and copper is at a one week low.

Category: MacroNotes

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One Response to “China slowdown concerns”

  1. Greg0658 says:

    we invest our own savings in factories overseas to fight labor costs here in our mature economy .. Favorable: information transfer rates – cash transfers – precise robots – cargo ships and transfer facilities

    introduce a fledgling host of new consumers to umBrands* eating up world consumables .. green green grass of home byebye for manual Labor and a transfer to Capital

    the next 100 years should be very interesting for the moderatly educated, lower IQ kids

    * to bad gravy extraction only happens at the top