For the First time, China’s economy shrank since 1992 in the first quarter.
As COVID-19 has paralyzed the production and the spending.
Beijing (China): Due to the outbreak of coronavirus, the production and spending have been paralyzed that raises an extreme pressure on the concerned authorities to do something to stop job losses. GDP of the country has fell to 6.8 percent in Jan-March year by year, an official report showed on Friday which is 6.5 percent decline reported by the forecaster analysts in Reuters poll and the expansion is reversed.
Understanding the Economic Shock of Coronavirus
This contraction in the growth is also the first time in world’s second largest economy since 1992 when the official GDP record started quarterly. According to the analyst, the policymakers have faced an uphill battle to revive the growth as this pandemic has ravages the global demand, while China has managed to set large part of the economy and running from the standstill in February.
Beijing has to deliver a stimulus package in the coming near-term and could be financed by central bank through the various channels, “Nomura” expected. They said in a note that this time we have expected that most of the credit would be used to help relief the enterprises, banks and the households to survive the COVID-19 outbreak, unlike the previous new credits went to the financial expenditure, infrastructure, the property and the consumer durable goods.
China GDP contracts 9.8% in first quarter due to coronavirus
According to the National Bureau of Statistics, on a quarter-on-quarter basis, GDP has fall 9.8 percent in the first three months as compared to 1.5 percent growth in the previous year. According to a separate data, the industrial output of China falls less than expected 1.1 percent in March a year earlier, Retail sales fall 15.8 percent in the same period and the Fixed Asset Investments converges to 16.1 percent in the month of January-March.
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