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China’s Loss of Economic Momentum
China wants to embrace a sustainable and higher-quality development. That means reducing their government intervention to allow financial markets to have a bigger say in allocating resources, and promoting domestic consumption at the expense of investment and exports.
“It’s like a Chinese medicine,” According to chief economist at Industrial Bank in Shanghai, Lu Zhengwei says that according to Money News, “If you don’t take it, you may have problems in future. But if you take it now, you cannot expect to regain your youth tomorrow.”
Data collected from the People’s Bank of China showed the nation’s broadest measure of new credit fell 19 percent from a year earlier and money supply also grew at the slowest pace on record, according to a report by Bloomberg News. Investors are focusing on the scale of the slowdown. China has not yet given annualized figures for sequential quarterly growth, which would result in figures that are more volatile than year-on-year numbers.
Beijing-based chief China economist at BNP Paribas SA, Chen Xingdong, has reported that “The quarter-on-quarter data will show growth momentum has actually bottomed out in the first quarter,” according to Bloomberg News, Chen Xingdong, who previously worked at the World Bank, said that the measure “has clearly captured the changes in growth momentum.”
Image Credit: www.ibtimes.co.ukChina’s Loss of Economic Momentum by Jaan