china-stimulus-will-have-little-global-impact-says-jp-morgan

China stimulus will have little global impact, says J.P. Morgan

Increased demand for commodities will affect mainly cement and steel, neither of which will benefit companies outside China, argues Frank Gong.
The Rmb4 trillion $587 billion stimulus package announced by China this past weekend is large enough to cushion the downturn in the domestic economy and ensure that the countryÆs economy continues grow above 8% a year, but its impact on the global economy and even the rest of Asia is likely to be much smaller than initially anticipated, according to Frank Gong, J.P. MorganÆs head of China research and strategy.

ôThis package alone will not be able to turn the global commodities markets around,ö he said at a press briefing yesterday. ôFor infrastructure spending you probably need steel, cement, heavy machinery and a lot of cheap labour, but China is still going to see a...
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