China Stocks Retreat After Hitting 5 Year High

China’s main share index finished the day lower after hitting its highest level in more than five years during a volatile trading day.

The Shanghai Composite closed down 0.2% at 3,285.41 after jumping as much as 3% earlier on speculation of more monetary easing by the central bank.

Data on Friday showed China’s inflation rate was 1.5% in December, remaining near a five-year low.

The figure was up from November’s 1.4%, but below the official target of 3.5%.

The inflation figure supports other recent data that indicates continued weakness in the Chinese economy, and analysts said that may give the government room to introduce fresh policies aimed at supporting economic growth.

Hong Kong’s Hang Seng index closed up for the third consecutive day, rising 0.4% to 23,919.95.

via BBC

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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 has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. 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