Late Sunday, the Wall Street Journal (WSJ) relied on the International Monetary Fund’s (IMF) report to mention that China’s state investments to fuel growth are amplifying slowing growth in productivity.
While the news praises Beijing’s ability to lift the economy from the effects of Covid-19, output per worker and unit of capital have been deteriorating off-late.
Additional quotes…
“By the measure of average productivity across sectors, a gauge of overall economic efficiency, China’s economy is only 30% as productive as the world’s best-performing economies like the U.S., Japan or Germany, the report shows.”
FX implications
While a general lack of market moves during the early Asian session stopped AUD/USD pair’s reaction to the news, the update dims the importance of China’s likely upbeat activity data, up for publishing around 02:00 AM GMT on Monday.
Read: Chinese Q4 GDP Preview: Economic growth back to pre-pandemic levels?
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