China indices point to weakening growth momentum – Nomura

FXStreet (Bali) – Nomura’s China indices point to weakening growth momentum, believing policy will remain accommodative given signs of growth momentum losing steam.

Key Quotes

“Our proprietary indicators (Nomura’s China Composite Leading Index, China heat-map and China Growth Surprise index) point to weakening growth momentum in Q3.”

“Following the benchmark interest rate and bank reserve requirement ratio (RRR) cut announced on 25 August, our Monetary Policy Signal Index indicates a relatively low likelihood (0.36) of easing in September.”

“We believe policy will remain accommodative, with fiscal stimulus playing a larger role in the rest of the year. We maintain our call of one more 50bp RRR cut in Q4”

Nomura’s China indices point to weakening growth momentum, believing policy will remain accommodative given signs of growth momentum losing steam.

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