Fed stimulus cut bodes well for Chinese exporters

By Feng Jianmin | December 19, 2013, Thursday |

Online Edition

US Federal Reserve’s long-awaited and long-feared decision to taper its stimulus program may brighten the outlook for China’s exports and have little damage on the country’s cross-border capital flow, economists said today.

Stephen Green, chief China economist with Standard Chartered Bank, said China still enjoys a big trade surplus and the interest rate differential is in favor of the yuan, so foreign exchange inflows should continue while the yuan strengthens.

Zhu Haibin, chief China economist with J.P. Morgan, said the Fed’s move was made to improve the US economy, which is positive for Chinese exporters.

The pull-back on stimulus will also add to the flexibility of China’s central bank in setting its monetary policies and easing pressure from hot money, or speculative foreign capital inflow, the economists said.

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Fed stimulus cut bodes well for Chinese exporters

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