China's quarterly GDP growth slows to 6.2pc as trade war bites
CHINA's economic growth sank to its lowest level in 27 years, pulled down by its ongoing trade war with the United States and weaker domestic demand, reported CNN Business
CHINA's economic growth sank to its lowest level in 27 years, pulled down by its ongoing trade war with the United States and weaker domestic demand, reported CNN Business.
The gross domestic product of the world's second largest economy rose 6.2 per cent in the second quarter, the slowest quarterly growth rate since 1992 and below this first quarter's growth of 6.4 per cent, according to government data.
In the first half of this year China's exports declined by 1.3 per cent year on year in US dollar terms, while imports fell 7.3 per cent. The country's exports to the United States contracted by 8.1 per cent in the first six months of 2019 and imports from the US fell 30 per cent against the same period a year earlier.
China's National Bureau of Statistics said in a statement that the economy will continue to face 'downward pressure' in the second half of this year.
'The Chinese economy is still in a complex and grave situation,' it said. 'Global growth has slowed and external uncertainties are on the rise.'
While Beijing and Washington agreed a temporary truce in their months-long trade war on the sidelines of the G20 summit in Japan, analysts say there is much uncertainty about whether they can strike a deal.
'Uncertainty caused by the US-China trade war was an important factor and we think this will persist,' The Economist Intelligence Unit's principal China economist Tom Rafferty was quoted as saying. 'Businesses remain sceptical that the two countries will reach a broader trade agreement and recognise that trade tensions may escalate again.'
Analysts anticipate Beijing will unveil more stimulus measures to lift the economy, including possible interest rate cuts by the People's Bank of China. The US Federal Reserve has also indicated it may lower interest rates.
'While the PBOC has already delivered stimulus this year, markets are awaiting... additional measures, which will probably come if trade talks collapse,' said Oanda market analyst Edward Moya. 'If talks steadily progress, we will still probably see the [bank] deliver fresh stimulus following the Fed's highly anticipated rate cut at the end of the month. '