China lending inflates real estate, stocks, even egg futures – the new york times dollar and rupee exchange rate


“Many commodities prices have gone up crazily,” said Du Shaoxing, a futures trader in Guangzhou, in southern China. Euro today rate in pakistan “We surely hope for a more stabilized trend where futures can reflect economic fundamentals. Fraction to decimal conversion chart The way in which recent commodity prices went up is worrisome.”

China’s latest bubble illustrates the potential risks of its newest effort to spur growth. Bloomberg world market futures The Chinese economy is already burdened with too much debt, economists say. What is a binary number And sometimes, stopgap measures to help the economy create long-term problems.

China is the world’s biggest producer of eggs, but it is not clear whether the investment surge in eggs will have an impact on real-world prices. Euro to usd conversion Jumps in the futures prices on commodities markets can take months

to trickle down to the real world, and if the commodities surge subsides, then the price of eggs in local markets may not budge.

Eggs are not the only commodity suddenly out of kilter. Cad to usd exchange rate by date Domestic prices and trading volumes on steel, garlic, cotton, iron ore and other items have all soared. Secret messages in logos This despite the fact that China’s economic slowdown has hurt demand for many items. Dollar euro forecast Officials at Chinese commodities markets are now taking steps to cool speculative fervor to avoid crashes, and prices have begun to ease.

By mid-April, the frenzy made Shanghai futures contracts in steel rebar, the rods used in construction to reinforce concrete, the most actively traded in the world — overtaking trading volumes of two major oil futures contracts, West Texas Intermediate and Brent crude, that have helped set oil prices for decades, analysts at Citigroup said in a report last week.

“There is very little rational or fundamental basis for why prices have gotten as out of hand as they have, or why volumes are so high, other than just irrational exuberance,” said Alex Wolf, an emerging markets economist at Standard Life Investments in Edinburgh, who previously worked as an American diplomat based in Beijing and Taipei.

Economists blame Beijing’s new efforts to shore up its economy. How the futures market works Government officials increased lending by state-controlled banks and offered other support measures in the first few months of the year as economic growth slowed and longtime drivers like manufacturing and exports showed continued weakness.

Saad Rahim, the chief economist at Trafigura, one of the world’s biggest traders of metals and oil, calculates that China added about $1 trillion in new liquidity in the first quarter of the year — an amount that would be roughly equal to the entire quarterly economic output of Germany during the same period.

A steel plant warehouse in Handan, in China’s northern Hebei province. Cny to usd chart Chinese steel output rose in March, despite repeated pledges to cut capacity to ease a global glut. Eur usd news Credit

The problems are most acute when it comes to China’s corporate borrowers, which have gorged on cheap credit in the years since the global financial crisis. Xauusd investing In a report released in April, the International Monetary Fund found that nearly 600 companies had almost $400 billion of debt that was considered at risk, accounting for 14 percent of total corporate borrowing in China.

But the renewed push for credit-fueled growth shows that policy makers’ concerns about China’s debt burden appear to have been set aside for now. Usd to aed conversion By delaying efforts to wean itself off cheap credit, China may be setting itself up for some problems related to debt and industrial overcapacity.

There are few places for China’s money to go. Put and call option agreement The country has tightened already stringent limits on how much money its people can send or invest abroad. Usd to inr exchange rate western union Its stock market is still recovering from a crash last year. Currency converter rs to usd And its property market remains saddled with a glut of apartments in many cities.

Stocks overtook property in investor interest last year. Cnbc stock futures market A raging bull market that was cheered on by official news outlets like People’s Daily, the Communist Party’s newspaper, skidded to a halt in June.