China's central bank may raise interest rates

Discussion in 'Markets & Economies' started by Peter, Dec 10, 2010.

  1. Peter

    Peter Well-Known Member

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    Peter, Dec 10, 2010
    #1
  2. Agauholic

    Agauholic New Member

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    Got a RE bubble ya wanna pop?

    Here we go
     
    Agauholic, Dec 10, 2010
    #2
  3. fiatphoney

    fiatphoney New Member

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    That'll do it
     
    fiatphoney, Dec 10, 2010
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  4. boneyard

    boneyard Well-Known Member Silver Stacker

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    China is making an annocenment on Saturday.

    Which is something ther NEVER do.

    will see where the dice roll...........:)
     
    boneyard, Dec 10, 2010
    #4
  5. Peter

    Peter Well-Known Member

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    Quote
    China raised the amount banks must hold in their reserves by 50 basis points effective Dec. 20. The move marks the sixth time this year China has taken this step, which effectively takes money out of circulation by forcing the banks to stash more.

    Investors had been expecting a more aggressive interest rate increase. So on the one hand, gold prices were seeing a bit of relief at the more tame measures, but gains were tempered on worries that a reserve ratio increase won't be enough to severely tame inflation and that a rate hike is still in the cards possibly after the CPI reading.
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    China is the world's largest gold producer and the second largest consumer of gold importing 209.7 metric tons in the first 10 months of 2010, equivalent to 7.4 million ounces. Although China's central bank has said it stopped buying gold, the country is encouraging gold investments.

    China is a big proponent of gold futures, bars and jewelry and the Chinese Securities Commission recently gave the green light to a gold mutual fund to give investors exposure to the international gold marketplace.

    http://www.thestreet.com/story/10943889/1/gold-prices-mixed-china-ups-reserve-rate.html
     
    Peter, Dec 10, 2010
    #5
  6. Peter

    Peter Well-Known Member

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    Downturn in China would mean a fall in Aud?
    Quote
    After QE2, analysts were looking for possible consequences of the Federal Reserve Bank's actions. What has become apparent is that the Fed has created another bubble in China. Investors globally have transferred devalued U.S. dollars and Euros to buy Chinese property and equities. China has had to combat imported inflation with rapidly rising asset prices. An influx of capital has caused a real estate bubble, a rise in costs of basic goods and excessive speculation in the commodity markets. The Chinese Central Banks will be observing the inflation data which should be coming out this weekend and will be compelled to act aggressively to prevent China from a bust similar to the housing crisis which occurred in the United States in 2007. Yesterday's IPO's showed that irrational exuberance is here once again, none since I have witnessed since the late 90's
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    Month after month applications to start real estate operations from foreign entities are doubling.
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    t would be naive to think that a surprised hike in rates and a downturn in China would not put pressure on gold and silver. Gold (GLD:NYSE) and silver (SLV:NYSE) are beginning to show signs of bearish reversals after a powerful move. Open interest in gold futures peaked on November 9th, a major reversal day. A tightening policy in China could keep buyers away for a significant amount of time or until prices come down to a more reasonable level.
    http://www.kitco.com/ind/Handwerger/dec102010.html
     
    Peter, Dec 10, 2010
    #6

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