Fed’s QE end could be good news for China: analyst  

美联储退出QE对中国利大于弊 出口商品将竞争力

(ECNS) – The Chinese economy may benefit from stronger exports as the US Federal Reserve is expected to pull the plug on quantitative easing (QE) at its official meeting Wednesday, financial analyst Yang Guoying said.

The end of the third round QE would likely send a signal to investors that the US economy is stabilizing, causing a capital inflow from emerging countries back to the US.

Although emerging markets cannot easily avoid liquidity risks, the impact on China won't be significant, Yang said. "China has huge foreign reserves, a massive trade surplus and low debt levels, and maintains strict control of its capital account. The Chinese central bank has enough room and ability to adjust currency liquidity."

China's exports would become more competitive as the US dollar strengthens against the Chinese yuan. Price drops of bulk products such as oil, ore and agricultural produce would help lower China's manufacturing costs, Yang said.

The world's second-largest economy grew 7.3 percent in Q3 2014, slightly above the 7.2 percent forecast but slowing from 7.5 percent in Q2.