BIS Says China Sell Off Part of Broader Response to Imbalance

Concerns over the world’s major emerging economies, and in particular China, are growing as financial investors reassess the outlook for global growth, the Bank of International Settlements said on Sunday.

After a month of turmoil for stocks and commodities, the quarterly update from the Switzerland-based forum for major central banks avoided making predictions about whether the turbulence was likely to deepen.

Introducing the report in a briefing for journalists, Claudio Borio, head of the BIS’ monetary and economic department, said that the falls in China’s stock market should be seen as part of a broader response to increasingly stark financial imbalances.

“We are not seeing isolated tremors, but the release of pressure that has gradually accumulated over the years along major fault lines,” he said.

via Reuters

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza