All eyes on Chinese GDP numbers today
City Index April 14, 2012 4:50 AM
<p>Asian traders will take comfort in offshore leads but today’s trading session will be dominated by one piece of data – Chinese GDP numbers. It’s […]</p>
Asian traders will take comfort in offshore leads but today’s trading session will be dominated by one piece of data – Chinese GDP numbers.
It’s perhaps the most important set of data out this month, even more important than trade and inflationary numbers. The quarterly GDP read will highlight the performance of the Chinese economy and put into perspective the recent sub 8% growth target for the year – whether its fact or mere conservatism.
Market expectations are for year-on-year GDP to come in at around 8.3% or 1.6% for the quarter.
The Australian dollar was trading higher ahead of the data, on the back of a rally in commodity prices. The Aussie was last buying 1.0430 against the US dollar.
The Euro remains steady at around 1.3183 while the Japanese Yen continues to appreciate with the US dollar last buying 80.90.
Copper bounced back above US$3.71/lb overnight, breaking through the important US$3.60-65/lb range we have discussed over the past few days. A retest of US$3.90/lb is possible if the Chinese GDP numbers show a solid read.
In regional corporate news, Singapore’s Genting – which operates casinos – is reported by analysts to be interested in Australian listed Echo Entertainment, the owner of casinos along the east coast of Australia. The play will be difficult though with rival casino operator Crown having recently sought to increase its holding in Echo to around 10% – enough to block a possible complete takeover.
Elsewhere, Chinese authorities are said to be tightening rules around foreign investment of state owned entities,particularly in larger projects like energy and minerals which have recently seen huge cost blowouts. China’s State Assets Supervision and Administration Commission has published new rules that will hold state-owned enterprises and their executives accountable for bad overseas investment decisions.
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