What do Chinese macro announcements tell us about the world economy?

• We examine the effect of Chinese macroeconomic announcements on world financial and commodity futures markets.
• Announcements related to Chinese output move stock markets, foreign exchange as well as energy and industrial commodities.
• The results suggest that markets view Chinese macroeconomic news primarily as a signal of the state of the global economy.

We examine the effect of scheduled macroeconomic announcements made by China on world financial and commodity futures markets. All announcements related to Chinese manufacturing and industrial output move stock markets, energy and industrial commodities as well as commodity currencies. News about Chinese domestic consumption leaves most markets unaffected, suggesting that market participants view the announcements primarily as a signal of the state of the global economy rather than merely of China's domestic demand. The market response to unexpectedly strong output announcements is not consistent with investors being concerned about tightening of Chinese macroeconomic policy; instead, the world markets view strong Chinese output as a rising tide that lifts all boats.