SHANGHAI, Mar. 6 (SMM) –
China Sets GDP Growth Target of around 7.5% in 2013
According to the government work report, China has set a 7.5% GDP growth target and 3.5% Consumer Price Index (CPI) target for 2013.
Shanghai Composite Index Plummets on Tougher Housing Curbs, Base Metals Prices Open Lower
The biggest market concern is tightening measures on China’s housing markets. Most of the base metals on the London Metal Exchange suffered losses on Monday, expect for LME copper, which stabilized as short selling eased some.
However, stricter controls over property sector in China will continue to put downward pressure on base metals prices.
Tightening Measures on China’s Property Sector Trigger Worries over Base Metals Prices
China will introduce tougher measures to tame rising house prices, heavily weighing base metals prices down. SMM believes housing curbs will significantly undermine demand for base metals, thereby weighing on base metals prices for a long time to come.
The current surge in prices and transaction volumes of second-hand homes in China will come to an end once China’s five new major measures (including levying 20% individual income tax on second-hand home sales) to cool property markets come into effect. Depressing housing markets will greatly undermine base metal consumption, especially copper, aluminum and zinc.
Base metal consumption will likely be sluggish in seasonally high-demand March, due mainly to mounting inventories and stricter control on domestic real estate.