Reserve Bank of Australia's Christopher Kent, Assistant Governor (Economic)
- Our central forecast is China will see further gradual moderation in growth over next few years
- Chinese policy so far has tended towards more accommodative policy settings, may raise risk of future disruptive adjustment
- We should be alert to the risk of adverse developments that could lead to a sharp economic slowdown in China
- Chinese authorities are attentive to these risks and have the scope to respond if needed
- For Australia, primary risk posed by the uncertain outlook in China is to commodity prices and exports
- A weaker AUD in response to negative developments in external conditions could be expected to act as a buffer
- Longer term, lots of room for further development in Chinese economy, which will provide Australia with many opportunities
Headlines via Reuters
Text: The Economic Transition in China
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On this ... "For Australia, primary risk posed by the uncertain outlook in China is to commodity prices and exports"
OK. let's insert a cat amongst the pigeons.
Commodity prices have already collapsed.
So the risk is in the price already and there isn't much more downside to come.
Flame away.
