Home > Development Economics, Economic Cycle, Growth, Inflation > The Chinese ship – back on course

The Chinese ship – back on course

Some figures for September show that the Chinese economy is tentatively starting to come out of its slowdown.

Exports rose to 9.9%
GDP for Q3 rose by 7.4%
CPI – 1.9%

The CPI figure is encouraging in that it gives the Peoples’ Bank of China plenty of room to ease monetary policy if they need to as the Inflation target rate is 4%. They have also pumped an additional US$42.15bn into the economy in order to stimulate growth. According to the National Australia Bank (NAB) the use of these measures appears to be the preferred method of monetary easing ahead of the start of the Communist Party Congress which starts on 8 November, where a new leadership team is set to be installed. The installation of the new leadership team could pave the way for a cut to the reserve requirement ratio and for fiscal stimulus. Many commentators envisage a soft landing for China.

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