(CN) China inflation continues to slow to 1.8% in July, this is the lowest level since January 2010. Food inflation continued to fall m/m to 2.4% y/y, non-food was a tick higher to 1.5%. Year-to-date CPI fell to 3.1% from 3.3% in June.
(CN) CHINA JULY RETAIL SALES Y/Y: 13.1% V 13.5%E; RETAIL SALES YTD: 14.2% V 14.3%E
(CN) CHINA JULY INDUSTRIAL PRODUCTION Y/Y: 9.2% V 9.7%E; YTD Y/Y: 10.3% V 10.4%E
(CN) China Govt does not seek return to double-digit GDP growth; goal is to “stabilize” economic growth, not to “maintain” it. – financial press commentary piece
(CN) China PBoC: Will intensify monetary policy fine-tuning in the second half of this year and improve credit policy to bolster the real economy
How it interpret these headlines?
After recent aggressive easings by the Chinese government, China economy’s potential “hard landing” seems to be all but an unlikely possibility now, especially confirmed by the controlled gradual slowdown in its recent economic readings. With China PBoC’s new intensified policy fine-tuning and the shift of focus from curbing inflation to stimulate growth, I believe China may achieve its GDP target of 8.0% for 2012, which means the recent gains in the AUD may very well be justified, and that the risk currency may still have plenty of potential in the months to come.
I will be looking to BUY AUD on dips, especially considering how much of Australia’s economy is dependent on the Chinese. If China is able to keep the growth target inline with forecast, I wouldn’t be surprised to see AUDUSD around the 1.0800 level.
China Economy Continues To Slow, Showing Signs Of Bottoming
August 9, 2012 by 4 Comments