Via Bloomberg
One interesting correlation is that a rise in Chinese property investment tends to lead to a rise in the Bloomberg Industrial Metals subindex. Take a look at the chart below and you can see the relationship.
In July property investment moved higher 3.4% y/y vs the estimated 2.5% y/y and faster than June's 1.9% pace. That was in conjunction with record volumes of steel and aluminium last month. So, this was enough to help copper pull off last Friday's lows and held the key trend line.See chart below:
The ongoing tech war with the US has led China to push the pedal to the floor with trying to kickstart domestic demand. However, the PBOC's stimulus is coming in at a steady pace and the consumption rebound is showing signs of flattening. Property investment however remains to be the main driver of the economic recovery. Take a look at copper below and the key trend line that will need to break in order to open the way higher for bulls.
