Lu Ting, analyst at Bank of America-Merrill Lynch, believes the Chinese economy is on course for a soft landing and that the central bank will ease up on intensive rate and reserve requirement hikes. The Chinese government is expected to maintain a “tight monetary, loose fiscal” policy, added Ting.
Strong export growth will help China maintain robust annual growth for 2011, commented Brian Jackson of Royal Bank of Canada. However, Jackson believes growth will diminish in the third quarter and bounce back in the fourth.
Todd Lee, Xianfang Ren and Alistair Thornton of HIS Global Insight projected continued deceleration in GDP growth for the second half. The analysts point to a 10-year record high nonfood inflation in June, arguing that further tightening will remain in the third quarter but ease up in the fourth as inflation ebbs.
Chinese ETFs include:
- iShares FTSE China 25 (NYSEArca: FXI)
- SPDR S&P China ETF (NYSEArca: GXC)
- PowerShares Golden Dragon Halter USX China Portfolio (NYSEArca: PGJ)
- Guggenheim China All-Cap ETF (NYSEArca: YAO)
For more information on China, visit our China category.
iShares FTSE China 25 Index Fund
