SLI GARS team positions fund for China rebalancing

Likely to have slower growth going forward

The Standard Life Investments' Global Absolute Return Strategies (GARS) team has positioned the fund for a rebalancing in China with pair currency trades and a position in Australian interest rates.

The investment team has said it has taken three positions in the £26bn fund with the Chinese economic slowdown in mind. "China's model of growth - credit-fuelled and led by state investment - has become exhausted and increasingly counter-productive. By our estimates, Chinese economic growth has slowed to 5% per annum," the team said. "Although Chinese authorities recognise the need to rebalance and restructure the economy, they face a range of difficult trade-offs which are all likely to result in slower growth in future." The three trades are a position in Australian short-dated i...