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Eurozone’s exposure to China is not significant – ECB’s Draghi

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Oct 22, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Mumbai) - President Draghi, while addressing a question on China slowdown, said a marked slowdown in China would have a negative impact on the Eurozone through different channels – direct, indirect, confidence, and financial.

    Draghi said EZ’s total exports to China are just 6% of the total exports, but mentioned some countries like Germany have a larger exposure (10% of exports to China). Thus, a slowdown in China would have direct impact on countries like Germany.

    Furthermore, a slowdown in China would kill commodity prices and therefore poses downside risk to inflation – an indirect channel, Draghi said.

    The president added further that a marked slowdown in one of the biggest economy in the world could rattle confidence in the financial markets and business confidence.
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