Daily FNArena News - International

Even allowing for the impact of recent bad weather DBS Group notes inflationary pressures are becoming the biggest threat for Chinese policy makers, so no change to tighter monetary policy is expected.

The Bank of Finland is forecasting Chinese growth will ease to 10% this year and 9% by the end of the decade, with inflationary pressures a major threat to the outlook in its view.

Somewhere in the world there’s at least another US$300bn in subprime losses we don’t know about yet.

China’s growth is tipped to slow this year but according to DBS Group this will make for more sustainable growth longer-term, making it a relatively safe haven in the current uncertainty.

As the Chinese government continues its fight against inflation its policy measures are becoming more restrictive and this has GaveKal cautious on the outlook for Chinese equities.

While GaveKal reiterates its lack of concern over a Chinese slowdown, Dennis Gartman has received some disturbing anecdotal news.

GaveKal fears the days of China’s deflationary impact may be over.

Both UBS and GaveKal are signalling the possibility of the Japanese stock market finding some strength.

Danske Bank suggests the Chinese Government intends to tighten monetary policy further via additional rate hikes, while a currency revaluation cannot be ruled out.

Having underperformed global markets over the past two years the Japanese market offers value but GaveKal cautions against taking an aggressive position as there are few catalysts to drive prices.