China’s economy cooled off as industrial output growth came in weaker than forecasted which has added pressure to the commodities market. Everything from oil prices to industrial and precious metals are in the red early on during Monday’s premarket session.
Data outlined that China’s industrial production grew by 3.8% YoY in the month of July, which was well short of the consensus figure that was anticipated at 4.6%. The figure also was weaker than the previous month’s level. Last month in June, China’s industrial production grew by 3.9%.
Weaker growth in the PRC has placed pressure on oil (CL1:COM) prices as crude dipped 4.9% down to $87.80 per barrel. Moreover, gold (XAUUSD:CUR), silver (XAGUSD:CUR), and copper (HG1:COM) all slide by 1.4%, 2.3%, and 3% respectively.
Exchange traded funds that track the above commodities have felt some spillover effects as certain funds mirror the price action of the commodities market.
Aside from China’s industrial economic report, the PRC also lowered two key lending rates and injected more cash into its economy as it looks to keep stimulating the economy.