Chinese hard landing still possible, says Iveagh
Iveagh, the Guinness family office and fund manager based in the UK, which runs a range of portfolios for the retail market, said that the next ten days will be crucial if China is to avoid a slowdown.
Chris Wyllie (pictured), Chief Investment Officer at Iveagh, said: “China has been worrying us for a good few weeks now and the corporate data has been poor. The conclusion we have drawn from our time spent in the country is that the situation is opaque, but markets may not be taking the risk of a hard landing in China as seriously as they should.”
“Over the next 10 days we will see further company reports and critical economic data and we will be keeping a close eye on the figures.”
Wylie highlights weakening commodity and a disappointing corporate reporting season as posing a risk to global market expectations.
“It’s about pricing in the right growth expectations. US equity markets in particular seem to believe the US economy can decouple and follow its own growth trajectory. They may think twice about that if China joins Europe in having growth problems. However, a China slowdown does not pose systemic risks for markets in a way the banking crisis did. If it leads to weaker commodity prices, this could ultimately be a positive for future growth. So it could present a buying opportunity in due course.”