A pedestrian walks past an electronic screen displaying the Hang Seng Index, left, and the Hang Seng China Industry Top Index in Hong Kong. Picture: BLOOMBERG/CHAN LONG HEI
Factory gate prices in China have soared 13.5% year on year to October, data showed, beating forecasts and warning of pressure heading down supply chains to global consumers. Longer-dated bonds had rallied on Tuesday, flattening the treasury yield curve, as investors seem to be wagering on hikes in the next year or so squashing growth and inflation in the years beyond.
Currency markets have been fairly quiet but traders favoured safe havens on Tuesday and lifted the yen to a one-month high. “I think we’ll need to see a [monthly US CPI] print of 0.8% to see the dollar index break out of the top of the range of 94.50,” he said. The index was last at 93.997.China’s economic slowdown is also nagging on investors' minds, especially as a credit crunch seems to be quickly spreading through the giant property industry.