Posted on 11/09/2014 8:27:10 PM PST by BenLurkin
China's economy, burdened by overcapacity and weak domestic demand, is headed for the slowest full-year growth in more than two decades. Lower oil and metals prices are cutting costs at the factory gate, allowing China's exporters to reduce prices and adding to deflationary pressures globally.
"China's domestic demand remained soft and dis-inflationary risks are on the rise on the back of falling global commodity prices," said Chang Jian, chief China economist at Barclays Plc in Hong Kong. "Subdued inflation offers room for more PBOC easing, but broad-based monetary easing will more likely to be triggered by disappointing growth numbers, which we will likely see in the coming months."
Chang said she expects the PPI drop will continue to 2015.
Purchasing prices of fuels fell 3.8 percent in October from a year earlier, while ferrous metals costs dropped 6.9 percent, the NBS data showed. Prices of all nine components dropped.
(Excerpt) Read more at finance.yahoo.com ...
maybe domestic demand is soft because the people are earning $1.50 an hour
“maybe domestic demand is soft because the people are earning $1.50 an hour”
They make more than that - the real reason is that nobody in China wants to buy goods made in China
The Chinese middle class, all 300 million of them, has stocked up all all the consumer goods they need.
The worker on the factory floor earns that much but remember that is all take home pay. The cost of living is also much lower.
That worker will have $30,000 U.S. in the bank.
lol
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