What was most notable in the CAAM sales findings is the fact that March has traditionally been a peak month for auto sales in China as it comes on the heels of local New Year’s celebrations. Estimations are that China’s total annual sales of cars in 2011 may not meet expectations of a 10 to 15 percent increase and will certainly not match the 32 record sales gain noted in 2010. More than 18 million new vehicles were snapped up from dealers across the country last year.
Back to the USA, where, now that the government continues to operate, the focus shifts to Wednesday’s speech by President Obama regarding the trimming of the massive federal deficit. A potentially highly dollar-beneficial topic, the resolve to cut and cut some more will be the apparent focus of Mr. Obama’s presentation. Specific debt-reduction targets and a specific timeline within which to accomplish certain cuts will be featured in Mr. Obama’s address to the nation.
While the contentious debate and last-minute wrangling between congressional leaders and the President on the topic of the looming government shutdown last week kept many on edge (especially currency traders) the “other deadline” that is fast-approaching is the one related to raising the US’ debt ceiling. White House sources have indicated well in advance of that event that “We should not be playing brinksmanship with [the] full faith and credit of the United States.”
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Jon Nadler is a Senior Metals Analyst at Kitco Metals Inc. North America