This morning, China's National Bureau of Statistics released its monthly data report, which was generally uninspiring, Commerzbank’s FX Analyst Volkmar Baur notes.
China's weak economy argues for lower interest rates
“Although retail sales were slightly positive, the other data points remained weak. Investment in particular was much lower than most analysts had expected according to Bloomberg. In addition to the housing market, infrastructure investment seems to increasingly weigh on growth.”
“So, all in all it was not a good start for the Chinese economy in the third quarter. We expect an improvement in the interest rate differential between China and the US as a result of the interest rate cut cycle in the US to boost the CNY in the coming months.”
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