Chinese inflation out today. CPI barely worth mentioning. The PPI is where the action is:
In May , international crude oil, iron ore, non-ferrous metals and other bulk commodities prices rose sharply, domestic demand recovered steadily, and China’s industrial product prices continued to rise.
There are 783 words left in this subscriber-only article.
Start your free 14-day trial today!
Here’s the detail:
It’s all steel and oil. Undoubtedly, China put a bid under steel. Oil is just OPEC manipulation.
Given the inflation is almost entirely driven by base effects on commodities and is not at all broad-based, markets buying of commodities to protect against commodity inflation shapes as the real culprit.
As China slows, this reflexive market bubble is going to go burst.