Economic data shows continued slowdown in China
Jeremy Hobson: The latest economic data out of China show a continued slowdown there. New numbers on factory output and retail sales came in below expectations this morning.
We’ve got the BBC’s Juliana Liu with us from Hong Kong with the latest. Good morning.
Juliana Liu: Good morning.
Hobson: So what is new exactly in today’s numbers?
Liu: Well, I think investors and China-watchers globally were looking to see if there were any signs of an economic rebound, and they didn’t really get signs of that. Industrial production actually fell; they were supposed to have risen. Retail sales also fell from the previous period. So really, the only good news came from inflation: Prices were lower, which is good for the Chinese consumer. But otherwise, the good news that a lot of people were looking for didn’t show up.
Hobson: Now, before the Chinese government was hoping for growth, they were trying to slow down the economy. So do they think that they went too far down that road?
Liu: It looks like it may have already gone that way. You know, China’s an enormous country with a lot of regional variations. But one economist based in Tsinghua University, Patrick Chovanec, says that in some areas, he thinks that growth for the whole year might only be 4 to 5 percent; that in fact, these official numbers don’t reflect the extent of the slowdown.
I think the picture’s clear if you look at corporate earnings — for example, Cathay Pacific, based here in Hong Kong, the world’s biggest carrier of air cargo, they made a massive loss in the first six months of the year. So I think the worry right now, as you say, is that the slowdown may have been overdone
Hobson: The BBC’s Juliana Liu in Hong Kong. Thanks a lot.
Liu: You’re welcome.
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