China Shows Signs Of A (Slightly) Slowing Economy

Manufacturing increased more slowly than expected in May, according to the latest Purchasing Managers Index, prompting fears that China’s economy overall may be moderating its growth rate. That should come with a warning about not putting too much store in one month’s figures, especially as manufacturing output usually slows in May, but as noted elsewhere PC sales have been weakening and the Labor Day holiday had seen lackluster retail sales for phones and TVs, suggesting that inventories are starting to back up.

At the same time, real estate property sales n Beijing, Shanghai and Shenzhen are down, too, suggesting that the crackdown on property speculation is taking effect. All of which, in turn, suggests there will be no urgency among policymakers to raise interest rates or let the yuan appreciate against the dollar.


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Filed under China, Economic Indicators, Macroeconomy

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