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Dalian sinks, nobody cares

Friday 9 December 2016

Dalian is slightly off its overnight limit down effort today and not even it cares about the Chinese inflation shock on its doorstep, rising after the print:

Likewise, Big Iron seems to think that nothing can stop it now with BHP -0.5%, RIO flat, FMG -0.7% and WHC -1.5%:

I can only repeat, China does not want inflation pull through that forces it to tighten monetary policy. It is trying to sustain high growth into next year’s Communist Party Congress, as well as destock oversupplied housing markets. That means it is going to have jam down even harder on the bulk bubble to stomp out the base of the problem. Be warned.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific's leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.