China posted encouraging results this week. Exports rose 5.6 percent beating expectations in October. Analysts had forecasted a 3.2 percent growth. Imports grew less than expected by rising 7.6 percent. Both numbers resulted in a net surplus of $31 billion in October. September’s surplus was half of that at $15.2 billion. The market took the Chinese trade data as a suggestion that global demand continues to improve.
The figures support the statements by Chinese Premier Li Keqiang that the Asian economy is on track to reach the 7.5 percent growth target in 2013. A far cry from the 10 percent pace China set in the past three decades, but a sign of the impact the global economic crisis has had on growth.
China is one of the largest consumers of commodities, so good news regarding continued growth benefit producers. China is set to become the number one consumer of gold this year, after India’s efforts to curb the metal import. Coal, steel and copper are markets where China leads both as a producer and a consumer.
The focus for the Communist party Plenum will be how to increase internal consumption to cope with the external drop in demand. Urbanization, financial reforms, ,social security, land ownership and pollution are some of the major topics that will be discussed.
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