Waning investor confidence about China's economy hitting year-end growth targets is showing in the country's credit markets and money supply data as an 11-week stock market slump, sudden yuan devaluation and an impending rise in United States interest rates take their toll. Early warning signs of a financial system's failing health and a widening credit spread reflect investor concerns that default rates may pick up. Frequent capital injections into the market by the People's Bank of China, as has happened repeatedly in recent months, on the other hand suggest tight liquidity and capital outflows. "Large parts of the Chinese economy are...
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