The rebound in China’s steel demand, considerably faster than expected, has left Macquarie analysts surprised. But that’s not all. Citi economists expect China to set a growth target of 5.5% in its 14th five-year plan. Admittedly, it is less than the 6.5% rate of growth aimed for by China in its 13th five-year plan. But, as Citi points out, indicates moderation as opposed to collapse of growth as was feared.
China has also indicated this growth will mostly be led by its domestic market. But what pleases Citi is the how of it. It looks like China will be focusing on developing its infrastructure. In particular, steel-intensive sectors like infrastructure, property, and automotive will be the key pillars for China’s economic growth.
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