The People’s Bank of China has quietly initiated a monetary counterstrike as the number of weak macroeconomic indicators mount.
“From a shipping perspective, the news emerging from China is comforting".
The People’s Bank of China has quietly initiated a monetary counterstrike as the number of weak macroeconomic indicators mount. Earlier this week, the slowdown in Chinese industrial production growth was another indicator of a slowing GDP growth level in the World’s second-largest economy.
Information regarding a four-year low level of Foreign Direct Investments has also surfaced this week. Now, Beijing has taken action to improve liquidity in the coming three months by applying the relatively new Standing Lending Facility to inject Yuan 500 billion (USD 81 billion) into China’s five largest banks.
The business conditions within the dry bulk, tanker and container shipping industry are closely linked to economic performance in Asia.
Chief Shipping Analyst at BIMCO, Peter Sand, said:
“From a shipping perspective, the news emerging from China is comforting. The industry depends on solid economic growth from China. The Authorities have now made sure that liquidity will not be an issue in the near-term
"The Chinese authorities acknowledged a long time ago that a soft landing is best for China. With a potential hard landing in sight, they have now taken measures to ensure their long-term goals remain undisrupted by short-term weaknesses.
“A prompt response like this is important to ship owners and operators as they plan for the future and build a case around China.
New data on key indicators sheds light on present, near-term and future shipping markets. This news piece follows up on BIMCO market reports and comments to commercial developments for the three main shipping segments.