The steel market in recent years the trend has obvious economic stage operating characteristics. The first half of 2008, subject to impact the world economy ever-increasing inflationary pressures and economic slowdown, commodity prices fall.
The beginning of September 2011, with the debt crisis in Europe the spread of the global economy into a recession phase, including China, commodity markets to re-enter the downstream channel. So the economic trends directly affect the steel supply and demand and market trends. From the current situation, there are three major factors that support our economy bottomed out in the second quarter (June-August):
First, macro-oriented. International front, the euro zone summit last week by 120 billion to promote economic growth plan, the euro area began tightening plus growth, difficult road to recovery, to start a real sense of self-help. Rare adverse economic domestic, the central bank repo, down quasi-likelihood of greatly increased, showing the determination of government to maintain growth.
Second, investment in fixed assets. Investment in fixed assets is now a pick-up, the whole year will reach 22% growth rate. 22% 22% of the previous years may be even a little faster, because the price is relatively low.
Third, the real estate. Real estate investments in the sectors in the first five months of this year accounted for 12% of GDP, compared to normal years, there has been no decline, play a role in boosting the economic recovery. More importantly, since the most recent period, the real estate industry, there have been signs of recovery of volume and price, and the wide range of consumer and real estate is gradually restored.
Above, with the bottoming out of the domestic economy, investment in the steel market and demand will improve in the second quarter Steel City is expected to bottomed pick up, but in the Steel City in July to continue the "bottom" probability.
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