For IT hardware and communications equipment makers, the more immediate issue is whether China's stabilization strategies will impact market demand and industry growth. The Chinese government still needs to relieve unemployment through moderate economic development, which is expected to grow by 8%. While considering a raise in cost of capital to show determination, the government has preferred to launch administrative investigations and enact credit controls in certain overheating segments. Additionally, market demand in PC and mobile phone sectors are showing reasonable growth and IT hardware and communications equipment industries are not classified as overheating. Judging from these factors, the impact on these industries is expected to be limited. However, the key to how the economy plays out ultimately hinges on how the government addresses expectations of RMB revaluation and the flow of hot money.