China’s reopening to reverberate around global markets

MARKETS always crave a good story and the relaxation of China’s zero-Covid policy, with the prospect of a sustained growth rebound, already has an excellent shot at being the noisiest narrative of the impending new year.

New, wide-ranging relaxations, which were outlined by China’s State Council on Wednesday (Dec 7) and include the possibility of home quarantine and dropping test requirements for public places, added to the picture of a nation on the brink of two profound shifts – one psychological, the other practical.

Markets in the US and Europe, note commodity traders, may have underestimated how big these shifts could be for prices and inflation.