George Soros on the tape warning China is losing its grip on inflation. Bloomberg reports,
The world’s second-largest economy is in a “bit of a bubble,” Soros, 80, said today at a conference in Oslo. There are some signs that China is “losing control,” he said.
China today ordered lenders to set aside more cash as reserves after inflation last month accelerated at the fastest pace in almost three years. Consumer prices rose an annual 5.5 percent in May, even after the central bank raised interest rates four times since September. Inflation has exceeded the government’s 4 percent target every month this year.
China’s formula for steering its economy is “running out of steam,” Soros said, adding the country is seeing the beginnings of wage-price inflation.
The recent pressure on commodities has more to do with China than today’s worries on Greece, which is causing the Euro to implode, in our opinion. Today’s dollar strength has caused a flash crash in crude oil as specs blow out their positions. Be sure to keep the Hang Seng and Shanghai support levels on your radar.
(click here if chart is not observable)