Chinese economy shows signs of slowing
GDP growth slower than expected in the third quarter
China’s gross domestic product (GDP) grew just six per cent year-on-year, it was revealed today. The figures were below forecast and, according to Reuters, represent the slowest pace of growth for 27 years.
Experts polled by Reuters had expected growth of 6.1 pc, and the Chinese Government had set a range of 6.0 to 6.5pc growth, putting these figures at the bottom of the range.
The pace of the Chinese economy has been slowing since mid-2019. In the first quarter if this year, GDP grew by a forecast-beating 6.4pc, but in the second quarter growth dropped to 6.2 pc.
The figures show the effect of China’s trade war with the US, which has particularly affected the manufacturing sector. U.S. and Chinese negotiators are currently working on a Phase 1 trade deal which will reportedly be signed in November.
Donald Trump has promised not to impose any further trade tariffs. However, China has stated that all earlier measures have to be cancelled in order to stop the trade war.
New tariffs on $112 billion (£86.9 billion) of Chinese goods, imposed by the Trump administration, were put in place on Sept. 1. China responded with retaliatory tariffs that targeted a total of $75 billion of US. goods. The tariff rate varies between five per cent and 10pc.
Beijing is planning a special local government bond issuance to inspire investing in regional infrastructure Economists polled by Reuters now expect Chinese growth in the third quarter to drop to 5.9pc.