China’s domestic demand dropped sharply

Here is news that will worry many about world economic growth prospects: if China’s exports have increased by 4.7% this month from a year ago, the figure amounts to a mere half of what had been forecast, namely 8.2%. And the situation looks even bleaker regarding imports that dropped by 6.7% whereas analysts expected a 3.9% increase. With a difference of 10.6 points compared to expectation, the misunderstanding keeps growing between most of the financial sector professionals who saw strong world economic growth and the world’s real economic trends that keep on contradicting with them. In accordance with Cyceon’s recent post, the vertiginous and continuous fall in oil prices could actually, as in Jul. 2014, anticipate a more severe correction of the markets than the very brief one that occurred in Oct. 2014. Indexes stay high but the figures from the US economy, welcomed as “good” ones, should not be able to repel, by themselves, the negative impact of a dull economic growth that seems to amplify first in Japan, second in Europe and now in China.