China Unlikely To See Double Dip Recession In Second Half (FXI)

According to a report from China Daily, China is unlikely to see a double dip recession in the second half of this year as its GDP slows. It is still expected to exceed 9% and given the uncertainty out there right now, you may want to take a look at shares of iShares FTSE/Xinhua China 25 Index ETF (NYSE: FXI).

"For China, it is never a recession unless the economic growth drops below 7 percent," said Lian Ping, chief economist with the Bank of Communications. For the second half of 2010, consumer consumption is expected to grow by 18.5 percent from a year ago while investment growth will decline to about 21 percent.

China is expected to keep a stable monetary policy for the rest of the year since economic conditions around the world are still very much complicated, and an interest rate hike is unlikely for the foreseeable future. The Bank of Communications also said in the report that the Chinese government would remain harsh on the property sector, but there is not much of a chance that the government places additional restrictions on this market.

Shares of the Chinese ETF have been climbing since the middle of May when reports first began to appear that China would slow considerably, possibly leading to another worldwide recession. This indicated that fears may in fact be overblown and risk appetite is coming back to the market.

Shares are currently trading at $41.46, flat in a solidly higher market so far.

You Can't Afford Miss Out On These Money Making Trading Ideas