The China flash HSBC PMI for June fell to a 9-month low of 48.3 (prev: 49.2), reflecting the weakening of demand as China's economic growth slows

The China flash HSBC PMI for June fell to a 9-month low of 48.3 (prev: 49.2), reflecting the weakening of demand as China's economic growth slows. Furthermore, funding costs have surged as the seven-day repo rate, which represents a gauge of confidence to lend in the interbank market, rose to a record high yesterday above 10%. Dr Jian Chang, Chief Economist at Barlcays says that, although People's Bank of China has the power to inject liquidity, it wants to gauge how well local lenders function under a liquidity squeeze especially as China rebalances its highly leveraged financial system. (VIEW LINK)