GUANGZHOU (Fund China) - The market in 2008 will be in a “big Band” and switch to relying on the stimulating investment demand from the export-drawing though the market is still on the upswing due to the tighten monetary policy and the sound development move.

The global consumer market will turn to the emerging countries from the developed countries, creating a preferable fundament for the global economy continual and stable growth in 2009 and 2010 although a decline in the global economy at present.

The leading indicator shows the future economic growth in China remains forceful. China’s economic growth will rely more on the domestic demand due to a decrease export by external economic weakness.

China will pay more attention to the inflation if the USA’s economic recovery appeared in the second half. The short-term appreciation will accelerate and the macro-economy management will tend to tight. But it will benefit the China’s economy stability in the future and the extension of the future market.

If the USA’s economy turns into a recession, then the investment and consumption borad related to the domestic demand will be more active due to the China economy growth fundament transformation.

The food price will continue to maintain for sometime in early 2008 due to a time periodicity of supple and demand switch and the domestic demand will be boosted by the increase in household income and inflation bringing an effect in CPI(Consumer Price Index).

A resources price adjustment will be introduced by the states in a proper occasion based on economic movement data. And the existence of the excessive money supply will lead to a continued pressure on the CPI;

Meanwhile, the ABN Amro TEDA fund management predicted that the CPI in the first half of 2008 will remain in a high level from 5% to 6%, and turn down after the Olympic.

The market in 2008 will be in a “big Band” and switch to relying on the stimulating investment demand from the export-drawing though the market is still on the upswing due to the tighten monetary policy and the sound development trend. The investor should keep an eye on the industries related to the Olympic,Two congress(National People’s Congress and National Committee of the Chinese People’s Political Consultative Conference) and the fixed assets.

Copyright Fund China 2008.

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