loading…
China’s surprise economic growth is not luring investors, the Chinese Communist Party is getting restless. Photo/REUTERS
BEIJING – China’s economic data throughout September provided many surprises, with faster-than-expected growth, falling unemployment rates, and little momentum in the consumption sector.
However, investors are not in a hurry to believe this.
China’s blue-chip stocks (.CSI300), down nearly 7% this year—compared with a nearly 10% rise in global stocks (.MIWD00000PUS)—were unfazed by the news and fell another 0.8% on Wednesday Then.
The yuan currency struggled to maintain its small gains, as buyers’ hands were tied by a range of concerns, from a crisis in the property sector to dimming prospects for accelerated growth.
“The third-quarter growth data alone is not enough to reverse market sentiment,” said Chi Lo, senior market strategist for Asia-Pacific at BNP Paribas Asset Management in Hong Kong.
“If this condition continues, including regarding revenues for a number of companies in the fourth quarter, then investors may return,” he continued, as quoted by Reuters, Friday (20/10/2023).
Official data showed China, the world’s second-largest economy, grew 1.3% in the third quarter, above market estimates of 1%, which appeared to cap a disappointing season.
This year’s growth of 5.2% is on track with China’s full-year target of 5%.
But property remains a springboard for growth and confidence in China, and even though the economy has hit rock bottom, there are no signs of a quick recovery that could encourage investment.