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Chinese deflation fears hit markets - business live

Discussion in 'Market News' started by Lily, Oct 14, 2015.

  1. Lily

    Lily Forum Member

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    Shares fall in Asia and Europe after Chinese producer prices fall for the 43rd month running


    8.44am BST

    #Lowflation hits #China! Inflation (+1.6%) falls more than expected. #CPI not above 2% since Jul '14. pic.twitter.com/vAni3nzBma

    8.42am BST

    Chinese annual producer price inflation has been negative for 43 months in a row. And counting. pic.twitter.com/bkd4THZPEd

    8.38am BST

    Tony Cross of Trustnet Direct agrees that today’s weak China inflation figures, and fresh deflation at the factory gate, are a worry for traders:

    Downbeat data from China – this time in the shape of weaker than expected inflation – is adding another layer of concern as to how the world’s second largest economy is managing the slowdown, and as a result the base metal mining stocks once again are wearing more than their fair share of the losses.

    8.32am BST

    Pizza chain Domino’s is bucking this morning’s selloff.

    8.17am BST

    Germany’s DAX and France’s CAC are both down around 1%, adding to losses earlier this week.

    Bloomberg TV’s Carolyn Hyde flags up that more than 100 billion euros has been knocked off Europe’s largest companies value this week already:

    Futures signal a 3rd day of declines in #stocks...Eu113b already wiped off Stoxx600 market cap this week pic.twitter.com/LUMKszPpF2

    8.16am BST

    Stock markets across Europe are in the red at the start of trading, and China is getting the blame.

    While Chinese consumer inflation (CPI) slowed further, Producer Prices made it a record 43rd straight month of deflation.

    While inflation gives the People’s Bank of China room to ease monetary policy further to support the slowing economy, hopes of more stimulus are clearing failing to appease market concerns especially with Q3 GDP data only days away

    8.09am BST

    Chinese policymakers may get another nudge to stimulate their economy next Monday, when GDP figures for the third quarter are released.

    Growth is expected to slow to an annual rate of 6.8%, from 7.0% in the second quarter of this year. That would be the first sub-7% reading since the financial crisis.

    7.50am BST

    European markets are expected to fall this morning, following the weak Chinese inflation data overnight:

    FTSE100 being forecast to open down around 45 points, at 6297.

    7.45am BST

    New fears over China’s economy are rippling through the markets this morning, after two piece of economic data showed that demand is weakening.

    The producer prices index - which measures what Chinese firms charge for their goods - slumped by 5.9% year-on-year in September. That matches August’s decline, which was the biggest drop since the financial crisis in 2009.

    #China remains biggest exporter of deflation. Sep producer prices extend slump for 43rd month http://t.co/SVBCMcbsA8 pic.twitter.com/rih2FpV8tt

    “In terms of global growth, the risk is skewed towards the downside.”

    Today’s Chinese CPI essentially guaranteed further cuts to the interest rate and the reserve requirement ratio (RRR) before the year is out.

    7.31am BST

    Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

    Coming up this morning...

    Today’s average earnings data could present Bank of England policymakers with a problem in the short term if they continue to trend higher as they have been doing for the past few months.

    Expectations for the three months to August are for an increase in wages to 3.1% from 2.9%, giving a further boost to hard pressed consumers who up until a year ago had undergone a five year fiscal squeeze in the other direction. The main concern would be if wages start to push higher in a wage/price spiral but that doesn’t seem likely at this point in time

    .@pierremoscovici in Athens today & tomorrow. Due to meet Greek PM Tsipras at 17.00 today #Greece

    Continue reading...
     

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