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China’s disappointing growth slowdown weighs on markets; oil hits new highs – business live

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Rolling coverage of the latest economic and financial news

Jim Reid of Deutsche Bank says ‘multiple headwinds’ hit China’s economy:

GDP expanded in Q3 by +4.9% on a year-on-year basis, which is a touch below the +5.0% consensus expectation and a shift down from the +7.9% expansion back in Q2. That’s come as their economy has faced multiple headwinds, ranging from the property market crisis with the issues surrounding Evergrande group and other developers, an energy crisis that’s forced factories to curb output, alongside a number of Covid-19 outbreaks that have led to tight restrictions as they seek to eliminate the virus from circulating domestically.

Industrial production for September also came in beneath expectations with a +3.1% year-on-year expansion (vs. +3.8% expected), though retail sales outperformed in the same month with +4.4% year-on-year growth (vs. +3.5% expected), and the jobless rate also fell back to 4.9% (vs. 5.1% expected).

“Although some of the recent weakness in services is now reversing, industry and construction appear on the cusp of a deeper downturn.

“For now, the blow from the deepening property downturn is being softened by very strong exports. But over the coming year, foreign demand is likely to drop back as global consumption patterns normalise coming out of the pandemic and backlogs of orders are gradually cleared. All told, we expect growth of just 3% on our China activity proxy next year, the slowest pace since the global financial crisis.”

“The outlook remains vulnerable with power shortages and property curbs.

“The investment side of demand is pretty weak, and the power crunch impact on the supply side is also pretty severe.”

Continue reading…Rolling coverage of the latest economic and financial newsChina’s growth slowed to 4.9% over last yearQuarterly growth drops to just 0.2%Beijing: Domestic and overseas risks and challenges have increasedFull story: Power cuts, property woes and Covid take tollJim Reid of Deutsche Bank says ‘multiple headwinds’ hit China’s economy:GDP expanded in Q3 by +4.9% on a year-on-year basis, which is a touch below the +5.0% consensus expectation and a shift down from the +7.9% expansion back in Q2. That’s come as their economy has faced multiple headwinds, ranging from the property market crisis with the issues surrounding Evergrande group and other developers, an energy crisis that’s forced factories to curb output, alongside a number of Covid-19 outbreaks that have led to tight restrictions as they seek to eliminate the virus from circulating domestically. Industrial production for September also came in beneath expectations with a +3.1% year-on-year expansion (vs. +3.8% expected), though retail sales outperformed in the same month with +4.4% year-on-year growth (vs. +3.5% expected), and the jobless rate also fell back to 4.9% (vs. 5.1% expected).“Although some of the recent weakness in services is now reversing, industry and construction appear on the cusp of a deeper downturn.“For now, the blow from the deepening property downturn is being softened by very strong exports. But over the coming year, foreign demand is likely to drop back as global consumption patterns normalise coming out of the pandemic and backlogs of orders are gradually cleared. All told, we expect growth of just 3% on our China activity proxy next year, the slowest pace since the global financial crisis.”“The outlook remains vulnerable with power shortages and property curbs. “The investment side of demand is pretty weak, and the power crunch impact on the supply side is also pretty severe.” Continue reading…