Money China's economic slowdown deepens, weighing on global growth

07:50  18 october  2019
07:50  18 october  2019 Source:   msn.com

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China ' s economic slowdown deepens . 12 August 2016. The IMF also warned China against setting annual growth targets rather than projections, which it claimed fostered "an undesirable focus on short-term, low quality stimulus measures". Chinese trade drop adds to global economic woes.

China ’ s economic slowdown is therefore both natural and desirable. Even though India’s real GDP growth rates exceeded China ’ s in recent years, the fact of the matter is that in In spite of China ’ s economic slowdown , China ’ s global economic reach and influence is set to expand, and that’s the

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BEIJING — China's economic growth sank to a 26-year low in the latest quarter amid pressure from a trade war with Washington, adding to a deepening slump that is weighing on global growth.

The world's second-largest economy expanded by 6 per cent in the three months ending in September, down from the previous quarter's 6.2 per cent, data showed Friday. It was the weakest growth since China started reporting data by quarters in 1993.

The slump adds to problems faced by Chinese leaders, including rising inflation and weaker consumer demand, as they fight a tariff war with President Donald Trump over Beijing's trade surplus and technology ambitions.

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SHANGHAI — China ’ s economic slowdown worsened in the July-to-September period, according to data released on Friday, as the trade war with the United States and a host of other problems leave Beijing struggling to meet its goals.

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"Pressure on economic activity should intensify in the coming months," said Julian Evans-Pritchard of Capital Economics in a report.

Asian stock markets declined on the news. China's benchmark Shanghai Composite Index lost 0.6% and Hong Kong's Hang Seng shed 0.2%.

The unexpectedly weak data raise the likelihood of interest rate cuts and other stimulus to shore up growth and avert politically dangerous job losses. Chinese leaders have boosted government spending but avoided a large-scale stimulus until now for fear of reigniting a rise in debt that already is so high that rating agencies cut Beijing's credit rating.

"More aggressive stimulus can be expected," said Bill Adams of PNC Financial Services Group in a report.

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“The idea that you could slow down the global growth engine and not affect other countries is just not credible.” Data increasingly suggest trade tensions are weighing on economic confidence China posted its weakest economic growth in 28 years in 2018, a pullback that analysts blame partly on

China ' s growth slowed in 2018 as a years-long campaign to As the trade war with the United States escalated last year and hit exports, global financial markets went into a tailspin on worries about a sharper China slowdown though many analysts believe an economic hard-landing is unlikely.

The slowdown in China, the world's biggest trader, has global repercussions. It is depressing demand for industrial components from Asian countries. Prices of soybeans, iron ore and other commodities have fallen, hitting Brazil, Australia and other suppliers.

Consumer prices have spiked due to a disease outbreak in China's vast pig herds that is disrupting pork supplies.

The International Monetary Fund cited the U.S.-Chinese tariff war in this week's decision to cut its 2019 global economic growth forecast to 3% from 3.2%.

Trump agreed last week to delay a tariff hike on Chinese goods and said Beijing promised to buy up to $50 billion of American farm goods. Officials say the two sides still are working out details.

Beijing has yet to confirm the scale of possible purchases. It is unclear whether Chinese leaders want more steps including lifting punitive tariffs already in place before purchases go ahead.

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The global economic slowdown is happening and could spread to the United States next year. In China , there are signs of a deepening economic malaise. The reasons for the weak performance are varied, and economists believe that both Germany and Japan will dodge recessions by returning to

U.S. stocks joined a worldwide selloff, after equities' worst month in more than three years, amid continuing concerns that China ' s slowdown will weigh on the global economy .Energy shares fell for the first time in five sessions as oil lost 7.4 percent after the commodity's

Beijing is resisting U.S. pressure to roll back plans for government-led creation of Chinese global competitors in robotics and other technology. Washington, Europe, Japan and other trading partners say those violate Beijing's market-opening commitments and are based on stealing or pressuring companies to hand over technology.

A bigger impact on Chinese growth appears to come from cooling domestic activity including consumer spending and investment.

Retail sales growth declined to 8.2% over a year earlier in the first three quarters of 2019, down from the first half's 8.4%, the National Bureau of Statistics reported.

Auto sales in China, the global industry's biggest market, are off 11.7% for the first nine months of the year.

That is a setback for a marathon official campaign to nurture growth based on domestic consumption and reduce reliance on trade and investment. Those plans call for maintaining exports that support millions of jobs.

Factory output growth slowed to 5.6% in the January-September period, down from 6% in the first six months of the year.

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China ’ s expansion looks to have slowed further this month, underscoring the A sharp deceleration in credit expansion may have weighed on the economy , according to Fielding Chen at The impact of slower credit growth amid a government campaign to clean up the financial system has, along with

The slowdown in global growth bears strong resemblance to a 2015-16 episode that was driven in large part by softness in China . This time around, China ’ s problems could prove even more damaging, warned economists at Oxford Economics.

Growth in investment in factories, real estate and other fixed assets slowed to 5.4% for the first three quarters of 2019 from 5.5% in the first eight months of the year.

Investment "is being held back by trade war uncertainties," said Adams of PNC.

China's exports to the United States, its biggest foreign market, fell 21.9% in September from a year ago. That helped to drag down overall Chinese exports by 1.4%. Imports of American goods sank 15.7%.

Beijing is struggling to cool consumer inflation that has spiked due to an outbreak of African swine fever that has disrupted supplies of pork, China's staple meat.

Consumer prices rose 3% in September, the ruling Communist Party's official target for the year, as pork prices soared 69.3% over a year earlier.

African swine fever has killed or prompted authorities to destroy millions of pigs. Beijing has increased imports, released pork from stockpiles and promised aid to farmers. But researchers say shortages are likely to last through next year while farmer rebuild their herds.


National Bureau of Statistics: www.stats.gov.cn

Joe McDonald, The Associated Press

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