***China's economy is accelerating again and inflation will tick up by the second half of the year after bottoming out in February, according to David Carbon, Managing Director of Economics and Currencies at DBS Bank.
"We look at the numbers and China gave us a touch and go three, four months ago, so it's no longer a question of hard or soft landing," Carbon told CNBC on Monday. "China has already taken off again, as has most of Asia." ***
I considered the March CPI report a negative one for Chinese developers. If China can secure a soft landing or even accelerate its growth, the government will surely maintain or even tighten its real estate curbs. My take is if China see hard landing risk high, the government may implicitly relax its real estate curbs to allow more construction activities to boost the economy.
Today, most Chinese ADRs are outperforming the S&P, but not XIN and its real estate peers. The market clearly understand the basic logic I just mentioned.