China is in trouble. After a strong popandemic rebound, the economy of the Middle Empire began to slow. In the third quarter of 2021, GDP grew 4.9%, the National Bureau of Statistics of China reported. This is a decrease of 3 percentage points from the previous quarter.
Information that shook the markets
The sharp slowdown in the Chinese economy has moved investors around the world. Markets worried about further production disruptions or supply chain disruptions.
The much lower results presented today are mainly due to interruptions in the electricity supply. Their main reasons are the much higher energy consumption of factories which are catching up with bottlenecks and trying to meet the increased demand in global markets. The pro-environmental policy implemented by the Chinese government is not helping either. The reduction in emissions has hit the energy sector, which relies heavily on coal-fired power plants in China.
Will the Chinese economy rebound?
Is one of the world’s largest economies expected to rebound in the near future? The TMS Brokers expert has no good news.
“As for the outlook for the Chinese economy, we should not expect a rebound in the near future. We are facing low consumption all the time, limited political support and investor mood is weakening. Forecasts show that by 2022, the economy of the Middle Empire will grow by only 5%. “ – explains Łukasz Zembik, head of the analysis department at TMS Brokers.
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