China: Barely any respite - BNPP

Christine Peltier, Research Analyst at BNP Paribas, suggests that thanks to the Chinese government’s expansionist policy mix, economic growth has just barely levelled off since last March, principally lifted by an upturn in investment in public infrastructure projects and the real estate sector.

Key Quotes

“In contrast, manufacturing investment and exports – the “traditional” components of growth – are still depressed, while private consumption and services – the “new” growth engines – have stalled since the beginning of the year. Medium-term prospects are becoming a little more uncertain given the difficult process of rebalancing between China’s growth sources, as well as due to the continued increase in credit risks in the financial sector and the numerous constraints that make it harder to manage economic policy.”