As everyone opined on China's 'goldilocks' GDP data all day long, perhaps the biggest news this evening was US Treasury's softer stance towards China's currency 'manipulation', as we noted earlier, [9] saying Yuan is merely "below appropriate medium-term valuation," and sure enough offshore Yuan has strengthened since the report. China's 'official' mouthpiece Xinhua told the people it is "unnecessary to be anxious about China's economic growth." And finally, for the 8th straight day, Chinese margin debt rose today to its highest in over a month. This is the longest stretch of releveraging in 4 months - since the peak of the bubble. "Will they never learn?"
He's back...
- GEITHNER: YUAN CAN BE SIGNIFICANT RESERVE CURRENCY IN LONG TERM
- *GEITHNER: CHINA CAN TRANSITION ITS ECONOMY WITHOUT CRISIS
Offshore Yuan is strengthening since US Treasuries Yuan Report... [9]
[10]
But PBOC weakened the Yuan fix for the 3rd day in a row...
- *CHINA SETS YUAN REFERENCE RATE AT 6.3614 AGAINST U.S. DOLLAR
[11]
Another day, another liquidaty injection...
- *PBOC TO INJECT 25B YUAN WITH 7-DAY REVERSE REPOS: TRADER
And then the China propaganda flowed:
It is unnecessary to be anxious as China’s economic growth in the first 9 mos. was within expectations and adjustment directions, the official Xinhua News Agency says in a commentary on website.
Chinese economy has enormous growth flexibility, market space and leeway
And ironically, given the worst GDP print in over 6 years (and a 10 year low in Industrial Production)... Officials aid economic fundamentals are unchanged...
Positive economic signs are increasing and economy has momentum, Xinhua reports, citing a meeting by the National Committee of the Chinese People’s Political Consultative Conference.
Equity markets are lower (modestly)
- *FTSE CHINA A50 INDEX FUTURES FALL 0.2% IN SINGAPORE
Shanghai Composite has retraced 50% of the post-Devaluation plunge...
[12]
As US Futures drift on the back if IBM's collapse... (Dow -50 points)
[13]
Weak China GDP sparked weakness in Aussie miners overnight and that is extending in today's market (following Glencore's tumble)...
[14]
And finally, it appears another crash is needed to remind the Chinese of the perils of levering up in a bubble...
- *SHANGHAI MARGIN DEBT RISE HITS LONGEST STRETCH IN FOUR MONTHS
"Will they never learn?"
Charts: Bloomberg
