China fooked

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Goldman does China is fooked in the nicest possible way. It ain’t short-term and it ain’t getting better. CNY is going to fall.


A clear picture of weak domestic demand: Combined with muted inflation and weak credit growth, July activity data confirmed the lack of domestic demand. With a few exceptions, most indicators showed sequential decline from June to July. For housing construction, infrastructure investment and steel production, the sequential declines were double-digit.

Negative impact of property slump permeating: Property investment contracted further in July, dragging down total investment. Retail sales of property-related items such as furniture and building materials significantly underperformed other items. And real estate services fell sharply, weighing on overall service output. High-frequency data suggest property sales dipped further in early August.

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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.