China’s rising inflation is waving a red flag at the country’s exchange traded funds (ETFs).
Wages have been running high, energy prices are high, and food costs and demand are exploding. Sounds a lot like the United States.
Carl Delfeld for ETF Folio adds that fresh evidence of inflation has emerged from China’s National Bureau of Statistics: from 6.5% to 7.1% last December.
The Chinese stock market was jittery about Tuesday’s Chinese February Consumer Price Index report, and with good reason: when it finally came out, the numbers were even worse than expected. It was up 8.7% year over year in February, its biggest gain since May 1996. The forecasts were for a 7.9% increase.
The iShares FTSE/Xinhua China 25 Index (FXI), PowerShares Golden Dragon Halter USX China (PGJ) and SPDR S&P China (GXC) were all down in intraday trading.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.