A quick recap of some numbers out of China this weekend:
- Factory production climbed 10.1 percent in November from a year earlier – 10.1%!
- Retail sales growth accelerated to 14.9 percent – 14.9%!
- The consumer price index rose 2 percent from a year earlier.
- Fixed asset investment excluding rural households in the first 11 months of the year rose 20.7 percent.
- Output of rolled steel rose 16.5 percent in November from a year earlier. (That’s a lot of steel).
- Growth is on track to rebound sharply above 8 percent this quarter.
Wasn’t it just a couple of months ago that the headlines (well….at least those out of the U.S) where riddled with talk of “China’s fall” “China’s Hard Landing” or “The Chinese Economy Derailed” – I think not. The growth engine is chugging right along, and I see absolutely nothing but “sunshine and rainbows” ahead for the Chinese economy.
China is now Australia’s largest export market, with trade worth at least $115 billion a year so continued growth in China should bode well for both Australia and neighboring New Zealand as well commodity rich Canada moving forward.
Companies supplying construction and mining machinery (such as Caterpillar Inc) should also look to do well.
The continued theme of “staying long the commodity currencies” should prove to be a strong strategy in the months ahead.