Chinese cooldown and Greek funding in focus

Sun Mar 8, 2015 5:13am EDT
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By Sarah White

MADRID (Reuters) - China's cooling growth prospects and an interest rate decision in Russia will shift the economic agenda away from the euro zone next week, although Greece remains firmly in the spotlight because of its precarious funding outlook.

China should provide further hints of the challenges it faces after the world's No. 2 economy depicted its "new normal" last week -- a growth target of 7 percent for this year, the lowest for quarter of a century.

Chinese retail sales growth is expected by some analysts to have slowed slightly in February, with industrial production and investment growth data due out next week seen weaker too.

As Chinese leaders try to mould a more balanced long-term growth model, keeping the breakneck economic expansion of recent decades in check, all eyes will be on the reforms they are expected to outline further in the coming days.

"Asia will be firmly in focus," Standard Chartered analyst Madhur Jha said. "The (Chinese) government is likely to emphasize the need for deeper structural reforms to ensure more sustainable growth, even if it is likely to be softer in the near term."

As markets digest China's warning shots, the euro zone's ups and downs will not be far from investors' minds.

A four-month respite for Athens after it extended a bailout program has done little to ease concerns that Greece may face a cash crunch before then.

Its funding options will take center-stage at a Monday meeting of euro zone finance ministers, who will discuss the economic reforms Athens hopes will help it unlock some financial aid from international lenders.   Continued...

A trailer loaded with container boxes travels in Ningbo port in Zhejiang province, January 22, 2015. REUTERS/William Hong