Assets price sensitivity to Chinese economic activity

Investors are concerned about China's growth outlook. Markets discuss on three aspects on Chinese economy are the pace of contraction, vulnerability of various assets to the slowdown in growth rate. The economy's growth rate is expected to contract to 6.0% in 2016 from  6.8% in 2015, says Barclays in a research note.

The sensitivity of asset prices to the country's growth rate was analyzed based on a regression model of year on year changes for a wide range of assets with year on year change in monthly economic indicator of Chinese growth.

In the estimation, Barclays reveals the currencies like BRL, ZAR, IDR, COP and CLP are more sensitive to the Chinese economic activity. Whereas, in case of commodity, the bank found that Chinese demand for gold and copper is highly sensitive to the economic activity of the country.