No quick fix for the Chinese economy
China is dealing with a property market overhang.
China - which is Australia's largest export market - is dealing with an overhang in its heavily-indebted property market that will likely take some years to work off.
Policy-makers can provide liquidity to facilitate the adjustment, but it is difficult for them to generate a fast economic recovery.
For example, residential investment has already been at a record share of GDP over recent years, while consumer spending is weak and households remain cautious with various estimates putting household saving at about 30-40% of income.
A weak Chinese economy is a clear negative risk for Australian export earnings, although the broader impact will be mostly felt by the Commonwealth budget, which seems likely to return to deficit if commodity prices settle at more normal levels.
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Based in Sydney, Kieran Davies is Chief Macro Strategist at Coolabah Capital Investments, an asset manager with 40 executives and over $8 billion in fixed-income strategies. Kieran is responsible for macroeconomic research and investment strategy, contributing to the investment decisions of the firm. Kieran has long experience as a macroeconomist in both the private and public sectors. He has worked most recently as Chief Markets Economist for National Australia Bank and was previously Chief Economist, Australia and New Zealand, for Barclays Bank and ABN Amro Bank/RBS. Kieran also worked as Principal Adviser on the macroeconomy and budget policy in the Commonwealth Treasury and Director of Forecasting.
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Based in Sydney, Kieran Davies is Chief Macro Strategist at Coolabah Capital Investments, an asset manager with 40 executives and over $8 billion in fixed-income strategies. Kieran is responsible for macroeconomic research and investment strategy,...
Based in Sydney, Kieran Davies is Chief Macro Strategist at Coolabah Capital Investments, an asset manager with 40 executives and over $8 billion in fixed-income strategies. Kieran is responsible for macroeconomic research and investment strategy,...
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