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The Q3 GDP growth of China – published today – can be seen as the first real post-pandemic reading by the country. Despite the effects of the coronavirus crisis not affecting the year-over-year figures anymore, the results nevertheless turned out disappointing at just 4.9 percent growth. Experts had expected a growth of 5.2 percent YOY.
While Q1 and Q2 GDP growth in 2021 were calculated against the pandemic quarters of 2020 and seemed sky-high for that reason, Q3 of 2021 is using Q3 of 2020 as a reference. By that time, the pandemic was virtually over in China and GDP growth had normalized. Yet, the coronavirus plagued the rest of the world for longer, affecting the global economy and in extension China. Other reasons for the lower-than-expected result are the country’s power shortage, connected to coal prices and production, as well as well as tight credit conditions brought about by the ailing Chinese housing market.
According to the National Bureau of Statistics of China, the country’s year-over-year GDP growth in Q3 of 2020 had also been 4.9 percent, while it was 6.5 percent in the final three months of that year. Prior to the COVID-19 crisis, the Chinese economy had stabilized at an annual GDP growth of around 6 percent following a gradual slowdown from more than 10 percent growth in the first decade of the 21st century.
This chart shows China’s quarterly real GDP growth since Q1 1992.