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USD dollar may weaken further, and manufacturing industry may reco
!!Zhang Zuohao, from Hong Ze Mi Dao (Shanghai) Investment Consulting Co., Ltd.

2017-09-15 08:45:35
Zhang Zuohao, from Hong Ze Mi Dao (Shanghai) Investment Consulting Co., Ltd., gives his speech
USD dollar may weaken further, and manufacturing industry may recover


Mr.Zhang's report is mainly focusing on two parts, weakening USD dollar and recovering manufacturing industry.

In the first part, he put forward the point that "USD dollar may weaken further and RMB value may continue appreciating". Economic fundamental in Eurozone is good, and interest rate may return to economic fundamentals. With ECB contracting monetary policy, expansion of US-Germany bond yield gap since 2012 has ended US dollar is expected to weaken in a long period in the future. U.S. economic growth has slowed down- higher interest rates lead to the downtrend of real estate sales. Expanding China-US interest rate gap since 2017 drives Chinese yuan appreciation. But Chinese yuan appreciation against USD is far less than USD depreciation, Chinese yuan is stable against a basket of currencies.

In the second part, Zhang considers that the manufacturing capacity circle has begun. First, main gauges including CAPEX, PMI, Caterpillar revenue and BDI have verified the start. Second, commodity market rises, bringing up medium-upstream enterprises' profit higher, and drives up the expectations and capacity expandions. The key concept is demand. Domestic demand continues being supportive while overseas demand has improved. Zhang's last suggestion is to observe these data and change capapital allocation accordingly.
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