China Crisis?

One country that has been slightly buffeted from the financial crisis has been China-until now. This of course has consequences for those of us that are trying to predict share prices through spread betting and forex trading as betting on how far and when the share index will fall.

The picture is confusing because last week the benchmark Shanghai Composite Index gained 26.68 points, or 1.42 percent, to 1,904.86. The Shenzhen Component Index rose 102.9 points, or 1.56 percent, to 6,719.88 suggesting strength rather than weakness. However, the latest report by the World Economic Forum implies that China is headed for a ‘heavy landing’ this year.

The country has been at the forefront of worldwide economic expansion in recent years, consistently producing double-digit gross domestic product growth, but 2009 could see a real reversal in fortune, according to one of the report’s main authors. Daniel Hoffman, chief economist at Zurich Financial Services.

Some analysts predict that China will see a fall in its GDP this year, as it is hit exceedingly hard by the global slump in demand for their goods. As for spread betting and forex trading the skill will come in trying to second guess what the Chinese government will do to boost its economy.