Economic growth in China has clearly slowed over the past few years, and data released this morning indicated the slowdown continued in Q4 2015.
Policymakers have a great deal of flexibility that should allow them to shore up economic growth should downward pressure intensify.
Real GDP Growth Inched Lower in Q4 2015
- Chinese GDP growth likely will continue to slow.
- Service sector output has remained resilient.
Construction Sector Indicators Point to Stabilization: A collapse in construction output does not look imminent.
Industrial Sector Should Decelerate Further: Slowing industrial growth is not entirely unwelcome by authorities.
Service Sector Remains Resilient: Income growth should support continued consumption growth.
Authorities have Policy Flexibility: Additional easing measures likely will occur at the margin.
Chinese economic growth slowed slightly more than expected at the denouement of last year, which may tempt some observers to fear the worst for the world’s second largest economy.
Read the complete commentary here: china-outlook-20160119