Under the circumstances of the US dollar strong, oil prices are approaching 100 US dollars per barrel, and the Chinese economy is weak, the market security valve is whether we will see China's expansion of fiscal expenditure.
The worst thing during the holiday is to come back to work.The Chinese market, which missed the hustle and bustle of the market last week, opened the market on Monday, and the CSI 300 Index (CSI 300 Index) fell 4.3%.
Even the central bank's loose measures last weekend failed to prevent the decline of the mainland company index of the Chinese stock market in Hong Kong last week.The People's Bank of China reduced the deposit reserve ratio by 1 percentage point, which is the fourth time in China this year.
This will allow domestic banks to repay the convenience of interim loan expired on October 15th, while lending more funds to the slowdown in the slowdown, thereby helping offset the impact of the upgrading of Sino -US trade tensions.
As the Chinese stock market performed on Monday, the exchange rate of the RMB against the US dollar also fell 0.8%to $ 1 to 6.926 yuan, and the Mark Bull of BannockBurn Global Forex;The decline this time is very unusual.
The tougher trade operation from the United States (part of the wrong words and deeds in China on Monday) did cause the possibility of weakening the RMB or the launch of fiscal stimuli. At this time, China is seeking to boost the economy.If the yuan has weakened to falling below $ 1 against RMB 7, it will be difficult to alleviate the worrying situation with the current US government, but this is a kind of weapon that China can use and it is worthy of cautious attention.
Why is China important to the global economy and market?
Ian Bull; Ian Harnett suddenly visited the Financial Times on Monday, and he talked a lot of views on Monday.We naturally have a good atmosphere on the market.
On the Chinese issue, Ian proposed that the recent loose measures may not continue until the first quarter of 2019.However, in his opinion, the loose currency and the soft RMB should curb the downside risks of global markets and investors.The US dollar strong, the price of oil is approaching 100 US dollars per barrel, and the weakening of China's economy has formed a major blow to the overall risk preferences of the global economy and various markets.
The security valve of the market is whether we will see China's expansion of fiscal expenditure.This will eventually help support global growth.Ian believes that for the euro zone, the importance of acceleration of Chinese economic activities is far more than the full economic firepower of the United States.
Therefore, we are likely to be close to a sliding door moment: or the US economy may begin to slow down at the beginning of next year (because the Fed's tightening monetary policy and the strong US dollar will cause economic activities), or China's loose measures will help support the global economy.Oil prices are an unknown factors, because oil prices, which have long maintained more than $ 100 for a long time, will cause great harm.
Translator/Liang Yanchang
