Repeated lockdowns due to the re-spread of Covid-19 have brought the world’s second-largest economy to the brink of recession. However, even the second half of the year does not give much hope for its recovery.
China’s economic growth is slowing down
China’s gross domestic product grew by just 0.4 percent year-on-year in the second quarter. This is a sharp slowdown in economic growth, which was still almost five percent between January and March this year. The culprit is the repeated measures taken by the Chinese authorities against the spread of the coronavirus infection, which has appeared in major Chinese cities, especially Shanghai.
The outlook for the second half of the year is not positive
While the June data suggested some economic recovery, this is unlikely to be enough for a stronger rebound on growth. “The outlook for the second half of the year is not very good in terms of a robust economic recovery. The economy faces uncertainties in the form of many unstable factors,” Chinese media reported.
Among other things, they urge China’s central bank to consider easing monetary policy, for example by reducing reserve requirements. However, the People’s Bank of China has said that its aim is to keep the Chinese currency stable.
