News Column

Australia : Policy settings and exports contribute to Chinese economic growth stabilising in Q2

August 16, 2014

The Southern winter ~ Northern summer edition of the Westpac-BREE China Resources Quarterly (CRQ) has been released today. The CRQ is the primary reference point for public and private sector decision makers seeking to understand developments in the Chinese economy, with reference to its demand for resources.

The Chinese economy grew at a rate close to, but slightly below its potential in the first half of 2014, supported by easier fiscal policy, firmer exports and the conclusion of the negative phase of the short run inventory cycle.

China s resources and energy use continued to be strong across most commodities. Against a backdrop of rising concern about its economic growth and construction, China s steel production was a record 209 Mt in Q2, up 4.7%yr, contributing to record iron ore imports of 235 Mt in Q2. Australia was a major contributor to this growth, with China sourcing 138 Mt (up 35%yr) from Australia during Q2.

Commodity prices continued to exhibit softness in Q2 2014 but contrary to popular belief, lower prices have been driven largely by increased supply rather than any material change in demand. This has been exemplified by Australia s bulk commodity export volumes which increased in the first half of 2014 despite lower prices.

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Source: TendersInfo (India)

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