Chinese president Xi Jinping was reported saying that China’s economy is stable and improving, according to The People’s Daily
Additionally, Xi was reported saying that they are confident of handling various risks, challenges and is confident about the conditions for sustainable growth.
However …
However, from the most recent data, it would have appeared that front-loading of exports by firms to the United States to avoid higher tariffs masked underlying weakness in the economy. Manufacturers in the Chinese economy had come under severe pressure recently from an escalating trade dispute with the United States. Casting minds back to last week’s factory activity showed conditions deteriorating as both domestic and external demand slackened. Monday’s Caixin/Markit Manufacturing Purchasing Managers’ Index (PMI) also showed only modest expansion at 50.2, unchanged from April, and above economists’ expectations of 50.0. What markets need to take note of is that fact that output growth fell and businesses were the least optimistic on production since the survey series began in April 2012.
“The ongoing China-US trade dispute, restrictive state policies, a weak automotive market and generally subdued global demand conditions were all cited as key factors likely to weigh on production over the next year,”
a statement accompanying the Caixin survey said.
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