The international markets have been badly tangled right now thanks to the trade war between the US and China. This trade war has meant that not only the two countries are suffering but the global economy on a whole is suffering as well. However, we can also see that the bigger impact might be on China and the US since they are directly involved in this war as well.
While there is the tension of a recession looming in the US markets, China has posted its economic growth for the third quarter of 2019. And the numbers show that China’s economy has grown at a rate which is slower than expected. This shows that the trade war is hurting China’s growth as well and they need to do something about it.
As per the report by China, their economy grew at a rate of 6% compared to last year. However, it was expected that China’s economic growth would be 6.1%. Now, Reuters reports that this is the slowest growth rate that China has achieved in the last “at least 27-1/2 years”.
Compared to the second quarter of 2019 too, China’s economy grew at a slower rate as 6.2% was the growth rate in Q2 2019. However, there has been a major fall in China’s growth rate which was once at 6.8% in the first quarter of 2018 due to credit tightening and the country’s trade dispute with the U.S.
Vishnu Varathan, head of economics and strategy for the Asia and Oceania Treasury Department at Mizuho Bank, mentioned in his note: “There is no doubt that the downturn is serious,”. However, more worrying for China is that its economy is expected to slow down even further. One analyst expects China’s growth to slow to 5.8% in the fourth quarter of the year, with the country’s full-year growth target to be 6.1%. But it is also reported that Chinese authorities are accepting the slower growth rate “Given the trade talks and the conflict with the U.S.”