Dr Andy Xie, renowned Chinese economist, considers that the China iron ore import number does not show real demand strength. Here is his recent interview with Bloomberg.
“It’s totally wrong to just look at the China import number to measure demand strength — a lot of people were talking about that, I saw — that’s a market mistake,” said Andy Xie, an independent economist who predicted in February that iron ore prices would sink into the $30s this year. “There’s no aggregate increase in demand even if China is importing more because it’s just translating” into steel exports, he said.
“Final demand for steel is dropping,” Xie, a former Asia-Pacific chief economist at Morgan Stanley, said on Tuesday from Hong Kong in a phone interview, adding iron ore prices may remain below $40 next year as China’s demand shrinks. “You look inside China, commodity prices are just inching down in a straight line from coal, iron ore, everything. The demand situation is very bad for all commodities.”
“The rise was an exception and we’re back to the old normal,” Xie said. “Iron ore from an investment perspective will become a low price, stable margin and low growth industry for many years to come.”
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Dr Andy Xie 謝國忠, Shanghai-based independent economist, has just been named “ 50 Most Influential Persons in Finance”by Bloomberg, and is currently director of Rosetta Stone Advisors.Dr Xie is one of the few economists who has accurately predicted economic bubbles including the 1997 Asian Financial Crisis and the more recent subprime meltdown in the United States. He joined Morgan Stanley in 1997 and was Managing Director and Head of the firm’s Asia/Pacific economics team until 2006. Prior to that he spent two years with Macquarie Bank in Singapore, where he was an associate director in corporate finance. He also spent five years as an economist with the World Bank.
Dr Xie earned a PhD in economics in 1990 and an MS in civil engineering in 1987 from the Massachusetts Institute of Technology.