China’s commodity markets started the second half of the year on a negative note, prompting expectations that next week’s major policy meeting in Beijing will shed light on how the government intends to address the problems of overcapacity and falling demand.
The Third Plenum is usually a forum for long-term political and economic reforms, and the general feeling among observers is that major initiatives are unlikely this time. But adjustments to the policy framework could still have consequences.
There is a view that China is likely to provide more support for the economic recovery, but investors do not have a clear idea of how resource-rich it will be, said Paul Bloxham, HSBC Holdings’ chief economist for global commodities. “We are watching and waiting to see what is delivered in the property, infrastructure and manufacturing sectors,” he said.
