China’s consumers and businesses are losing confidence. Car sales have plunged. The housing market is stumbling. Some factories are letting workers off for the big Lunar New Year holiday two months early.
...beneath the surface, a sharp slowdown is building. Foreign investment plunged last month. Auto sales over the past three months have fallen by record percentages. Floor space completed, one gauge of the housing market’s health, has slumped this year. Sentiment among Chinese purchasing managers has soured.
Many supply chains to the United States are stuffed with extra inventory thanks to stockpiling, so American importers may need fewer goods in the months ahead.
World stocks tumble on weak economic data from China and Europe
A Chinese statistics bureau spokesman said the November data showed downward pressure on the economy is increasing.
The data “means that the worst is yet to come and policymakers will be very worried, particularly with consumption growth falling off a cliff,” said Sue Trinh, head of Asia FX strategy at RBC Capital Markets in Hong Kong.
“So I expect further support measures including rate cuts will come in coming weeks, although these data would indicate measures to date aren’t really working.”
A difficulty, as always, is getting a clear picture on the Chinese economy. They "cook the books" to make it look better than it is. So the official statistics are suspect. But they are an export driven economy, and the US is no longer just accepting predatory Chinese trade practices. Also, due to other factors, the EU is slowing down demand as well.
Ideally for China they transition to internal sales, but due to the increasing layoffs, and concerns for an uncertain future among the Chinese citizens, consumer demand inside China is falling. People without work cannot buy stuff. Laid off workers are packing their cheap suitcases and traveling back to their home towns. They won't be buy much other than food.
|China Economy Trouble||195||Race Jackson||16-Dec-18 23:28|