Tag Archives | China

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China’s inflation out of control

China’s inflation hit 5.4% last month. As the chart above shows, it has more than doubled over the past year. And food prices jumped 11.7%. Clearly, inflation is now out of control, with the Ministry of Finance admitting the situation is “severe and hard to handle“. A sign of the scale of the problem is […]

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Boom/Gloom index signals rising austerity

Q1 was a very strong quarter for Western companies operating at the upstream end of the chemicals value chain: • Plants were generally operating well, with few force majeures • Most importantly, the crude oil price jumped 20%. Many buyers had reduced inventory in December for working capital reasons. Then they found they had to […]

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China’s economy hits the ‘pause’ button

The blog’s recent Asian visit revealed considerable anxiety about the state of demand in China. As its blogging colleague, John Richardson, has also described, the country’s lending cutbacks may finally be taking effect. New official figures for lending and electricity consumption support this view. These are two of the only 3 figures trusted by likely […]

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China has “60% risk of banking crisis by 2013″

China’s housing market seems to be facing the threat of a major downturn. That is the only conclusion to be drawn from the rising sense of concern being expressed by policymakers and the official media. Last year, China’s Academy of Social Sciences estimated that “there are 64.5 million empty apartments and houses in China’s urban […]

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Shipping index signals China slowdown

The blog’s recent visit to Singapore included several discussions about the slow start to the New Year in China. And these concerns were confirmed last week in the downturn reported by the OECD’s leading indicators for China (Organisation for Economic Co-Operation and Development). Separately, as the chart shows, the Baltic Dry Index of ocean freight […]

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OECD indicators signal slower growth

The OECD’s leading indicators for the global economy suggest that GDP growth is continuing to slow. As the above chart from the American Chemistry Council shows, the OECD’s three key indicators have all slipped from H1 2010′s peaks. The composite indicator (blue) has fallen sharply to +5% from +13%, whilst industrial production (red) is down […]

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China battles food and house price inflation

When China announced that inflation had reached 5.1% in November, the authorities insisted it was only a temporary peak. But this seems less likely today, with January’s inflation still at 4.9%. The surge in food prices is very worrying. They jumped 10.3%. And with a major drought underway in the North East, there is a […]

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China seeks ‘soft landing’ for house prices

Housing’s share of China’s GDP has tripled over the past decade to 6%. This, of course, has stimulated demand for chemical and polymers. But as the Bloomberg chart shows, it is also worryingly close (blue line) to the peaks seen in the USA (black line) and, before then, Japan (dotted line). The rise has been […]

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Mubarak’s departure may weaken oil prices

History doesn’t repeat, but it sometimes rhymes. That was the insight of the famed American writer, Mark Twain. 2 weeks ago, this led the blog to highlight the similarities between the geo-political concerns then developing in Egypt, and the Israel/Iran stand-off which had marked the oil price peak in June 2008. We still cannot be […]

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China’s PE imports slip: Middle East gains market share

China has been the main source of chemical and polymer demand growth over the past 2 years. But newly released trade data suggests its import volume on core products such as polyethylene may now be reducing, as more domestic capacity comes online. Equally, Asian producers, and the USA, face strong competition from low-cost Middle East […]

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