It seems the markets were spooked yesterday by the Shanghai index being down and people wondering what sort of landing China will have. It seems a real worry, but provided oil price is affordable, most economies would be happy to keep their work-forces busy and happy, with improving living standards.
A recent assessment by Dr Zoellick of the World Bank and by senior Chinese Economists surmised that China will have a soft landing, with about 7.5 percent growth. I think it would be in order to assume that that will be so, as those are very conservative predictions.
The BRICS get-together in New Delhi have decided on a parallel to the World Bank, to help poorer developing nations. That may add about $500 billion in the currencies of Brazil, Russia, India, China and South Africa. That would add to the excitement of the FX markets, I guess, and certainly add further to the growth story.
The statement yesterday by Sheikh Ali Al-Naimi the Saudi Oil Minister that there is no rational reason for such a high price as is prevailing currently will hopefully drive the Oil price down to economically sustainable levels, so it is a happy picture for world growth, ensuring sound income for the OPEC countries so projects in their countries can also be viable. A slightly lower oil price will be a win/win situation for all countries, ensuring continuation of worldwide economic Recovery. For that I pray.