Here’s a take from Barclays that reiterates my views nicely:
The impact of higher infrastructure spending on steel demand will be tempered by the weak property market, which has much higher contribution to steel consumption. Historic analysis shows iron-ore and steel prices tend to fall during periods with high infra spend and weak property starts.
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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.
