Weaker Chinese economy will impact the global economy and markets

Financial experts at Danske Bank suggest that there’s an ascending risk for global markets because a dipping Chinese economy will have a devastating impact on the global economy as well as markets.

No one denies that China happens to be the primary contributor to the world economy, generating one-third of global surge. The Asian country acted as a main driver behind the global revival in 2016. Commodity exporting emerging markets derived benefits from both higher volumes as well as prices, while developed markets witnessed a surge in exports to China and also other emerging markets. With the Chinese economy decreasing this year, the lift to the world economy rebounds and it’s a huge reason why financial analysts look for a high in the PMI cycle in H1.

The steep ascend in commodity prices observed in 2016 was pulled mostly by higher Chinese activity. Well, with Chinese companies consuming approximately 50% of global metals, this Asian country appears to be a number one driver of commodity prices. Moreover, for the last few months, both metal and crude prices have gone down, which could be explained by the softer Chinese economy.

Similar

02.12.2022 11:51 Get Ready for the NFP Release

Good Friday, traders! The markets are frozen ahead of today's NFP release at 15:30 GMT+2…

01.12.2022 14:11 US Dollar Index at a 3-month Low

The USD weakened after Fed Chair Powell hinted at a slowdown of rate hikes, and stocks strengthened. What else is moving the markets today?

30.11.2022 12:07 Soon Bullish Rally for Gold

The winter is coming, and risky markets expect a rally to come with it. Will this December be bullish for stocks, crypto, and gold? A pack of news will surely help you out.