China officials 'said the right things' but lack action on economy
Chinese equities are in focus after Chinese officials said that it would embrace a "moderately loose" monetary policy and a "more proactive" approach to fiscal stimulus policy. The Shanghai Stock Exchange Composite Index (000001.SS) has gained on the news. The shift in China's approach to economic policy comes just ahead of US President-elect Donald Trump's return to the White House. Macrolens chief strategist Brian McCarthy joins Catalysts Co-Hosts Seana Smith and Madison Mills to discuss his concerns that the talk of economic policy changes may not result in meaningful action. "They certainly have talked the talk on stimulus once again, moving from a prudent monetary policy to moderately loose, which was last seen in the wake of the global financial crisis, and talking about a more active fiscal policy as well," McCarthy says. The strategist adds, "They've said the right things, but in the past, they've said the right things, have talked the talk and failed to walk the walk, and I think that's going to once again be the case." McCarthy explains that the "ultimate constraint on any stimulative policy in China" will continue to be the Chinese yuan. "I would like to see some movement in the exchange rate that would confirm, for me. that they're finally prepared to walk the walk, which is a risky path," McCarthy says, adding, "Talk [is] great, but the actions I see aren't all that optimistic." To watch more expert insights and analysis on the latest market action, check out more Catalysts here. This post was written by Naomi Buchanan.
