June 19, 2008 at 11:00 am by Tom Lydon
China’s exchange traded funds (ETFs) might be staging a turnaround if a World Bank report on the country turns out to be accurate.
The growth forecast for the country has been raised to 9.8%, up from 9.4%, and that they’re weathering the global slowdown better than expected, reports Elaine Kurtenbach for the Associated Press.
In particular, China’s strong domestic demand and continued
competitiveness when it comes to exports are among its biggest
strengths.
Looks like the World Bank has trouble making up its mind, though: two months ago, it had lowered the growth estimate to 9.4% down from 9.6%. But you can’t fault them too much, because we’re in uncertain times. No one knows if oil is going to go higher, if food will ever be affordable again or if the financial sector is ready to begin its recovery.
China is less optimistic about its growth, predicting 8% this year. Last year’s growth was 11.9%.
China also found out today how not fun it is when gas prices rapidly shoot up when the government raised the prices by 18%, Carolyn Qu, Chen Aizhu and Paul Eckert for Reuters report. The move is meant to tamp down demand in the country, which has been one of the factors cited in rising fuel costs. The new prices will take effect on July 1.
China’s ETFs so far today have been breaking about even:
- SPDR S&P China (GXC), down 20.2% year-to-date
- iShares FTSE/Xinhua China 25 Index (FXI), down 17.7% year-to-date
