China needs a stimulus bazooka, but it’s firing a scattergun

News Snapshot:

Perhaps most instructive for Australian investors, iron ore futures in Singapore rose 0.8 per cent to $US107.5 a tonne. The price of the steelmaking commodity had hit $US115 last week following the Chinese Politburo (the Cabinet of President Xi Jinping) announcing it would stimulate the economy, but the rally has rapidly faded. Citi analyst Wenyu Yao says two forces are at work: not only have the stimulus measures failed to live up to expectations, but China also appears to be placing production curbs on some steelmakers. Citi sees iron ore heading back to $US100 a tonne as supply outstrips demand...