SHANGHAI, Aug. 14 (SMM) – Market will eye Chinese economic data today, such as Jan-Jul. urban fixed asset investment, Jan-Jul. industrial value-added, and July retail sales.
The US dollar fell to near 93 last Friday as US July CPI was below forecast. But, US July CPI was better than June’s level, suggesting US economy is recovering, which will allow the US dollar to rally.
China GDP grew 6.9% in Q2, higher than forecast. China’s industrial production, investment, retail sales and exports were all positive. But, market should not be too optimistic. Chinese economy should stabilize after high growth. The NBS will hold national economy situation news conference for August tonight.
China’s new RMB lending totaled RMB 1.54 trillion in June, up from May’s RMB 1.11 trillion and beating forecast. China’s M2 rose 9.4% YoY in June, versus May’s 9.6% growth and marking five consecutive months of slowdown. The PBOC once said it is normal for M2 to slow down as long as reasonable financing needs of real economy could be met. Report from Bank of Communications’ financial research center showed M2 growth may pick up in July, citing seasonal low base. Debt swap rose a lot from past months, which may drag business lending. Low pressure of cross-border capital outflows and recovery of direct financing market will allow M2 growth to rally slightly. So, China’s M2 is expected to grow 9.5% YoY in July.
See SMM price forecast, please click: SMM Price Outlook for Base Metals on SHFE (Aug. 14, 2017)