Christine Lagarde tells China it has a ‘communication issue’ as Chinese stocks continue to slide

The Shanghai Composite Index closed down 3.2 per cent

Hazel Sheffield
Thursday 21 January 2016 10:53
Comments
Christine Lagarde, managing director of the International Monetary Fund
Christine Lagarde, managing director of the International Monetary Fund

Chinese stocks ended the trading session lower on Thursday after showing promising gains in early trading.

The Shanghai Composite Index closed down 3.2 per cent after a volatile day, adding to a decline of 18 per cent in 2016 alone off the back of falling oil prices, down to lows not seen since mid-2003.

The losses came despite a shot in the arm from the People’s Bank of China, which attempted to shore up liquidity in the system by injecting more cash.

China has "communication issue" that unsettles markets, Christine Lagarde says https://t.co/fEqSrXRdub #WEF16 #Davos https://t.co/uSTQ60z9Is

— Bloomberg Business (@business) January 21, 2016

As Asian markets closed, Christine Lagarde, managing director of the International Monetary Fund, took to the stage at Davos to discuss where China is heading.

She said that China had one big problem: communication. “There is a communication issue, which is something markets don’t like,” Lagarde said.

China Sec Reg Vice chair Fang says market is getting more complex but we have enough smart people to run it. #WEF16 pic.twitter.com/Id3kAQn08d

— Holger Zschaepitz (@Schuldensuehner) January 21, 2016

Largarde said that China was going through several economic transitions, from industry to service, export to consumption and also a governance change relating to anti-corruption.

“Better and more communication would serve that transition better,” she said.

The FTSE 100 opened up 0.8 per cent on Thursday after slipping into bear-market territory on Wednesday, defined as a sustained fall of over 20 per cent on stock market indices.

But the rally was short lived. An hour aftert opening, the FTSE 100 had slid 0.2 per cent lower, marking the start of another volatile day.

Register for free to continue reading

Registration is a free and easy way to support our truly independent journalism

By registering, you will also enjoy limited access to Premium articles, exclusive newsletters, commenting, and virtual events with our leading journalists

Already have an account? sign in

By clicking ‘Register’ you confirm that your data has been entered correctly and you have read and agree to our Terms of use, Cookie policy and Privacy notice.

This site is protected by reCAPTCHA and the Google Privacy policy and Terms of service apply.

Join our new commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

Comments

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged inPlease refresh your browser to be logged in