China has moved to curb its inflation by increasing interest rate 25bps. It is unexpected but a correct move.
The commodity market has retreated because of the Chinese move. But the obvious trade sometimes is not the right trade. I do not believe that The Fed will abandon its QE2 and probably will increase the amount of QE2. The increased money supply will stimulate emerging market more than U.S. itself. The dilemma is QE2 will hardly move the U.S economy (maybe 50bps for GDP) but will inflate CPI in emerging market.
I will buy 500 IMG @17.1 (C$) today.
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