Time to reduce commodity exposures

Chris Watling | Longview Economics | 01 August 2011

Risks are increasing that China’s economy will slow more than expected. Its yield curve is close to inversion (that is, signaling a meaningful growth slowdown) and official short-term interest rates have also moved meaningfully higher in recent months (while unofficial shadow banking rates are reportedly many times higher than official rates). Leading economic indicators are slowing: PMI surveys continue to slow while car sales are contracting and copper imports are falling. Added to that, inflation is yet t...