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Should we worry about the recent Chinese data?

Published: Friday 12 July 2019

  • Poor Chinese imp/exp data worries markets
  • Eurozone industrial production due

The New Zealand Dollar weakened overnight after the NZ Purchasing Managers Index was below market expectations, even though it was a rise from last month. However, Sterling’s lack of oomph (technical term) means the GBPNZD rate is still down at 1.8750.

Poor Chinese imp/exp data worries markets
The Chinese data we saw overnight showed a sharp drop in exports (a 2 percent contraction in fact) and a continued decline in imports; 4.5 percent contraction after the 8.5 percent drop last month. These are very worrying for the countries that supply China with raw materials but the drop in demand for Chinese goods has something to do with the US tariffs and also the slowdown we are seeing in the EU and elsewhere.
Eurozone industrial production due
This is going to be a slow day for data but there are a few tidbits to get excited about. Perhaps most interesting is Eurozone industrial production, which may well show an improvement from last month’s 0.5% contraction. That would be good for the Euro, which has benefitted from a few improvements in economic data this week. The underlying concern over the global economy still weighs on everything though. There is an unconfirmed report that there may be a Eurozone Finance Ministers meeting either today or tomorrow as well.
And it’s going to be a really busy weekend for sport. The British Grand Prix, England’s cricketers in the World Cup final after beating Australia by 8 wickets (but I’m not gloating) and two fantastic Wimbledon singles finals to come. I can feel a sofa day coming on. Have a great weekend

At the bar

A Chinese guy walks into a bar, sits down and starts sipping a pint. The guy next to him says, “Hey, do you know any karate, ju-jitsu, aikido…any of that kind of stuff?”
“That’s a bit racist”. Says the Chinese guy.  It’s typical that you would assume that, because I look Chinese that I’m bound to do some kind of martial arts. WELL No I DON’T! You are such a racist. Why would you ask me a question like that?”
“Well I asked,” says the guy, “because you’re drinking my beer.”

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