At the twice-a-decade Party congress under way in Beijing, China’s leadership is making plans for the next 30 years. To achieve his grand ambition, Xi Jinping will need to provide for “the people’s ever-growing needs for a better life”. It is a tall order for an economy which has seen “unbalanced and inadequate development”, as Xi put it in his opening three-and-a-half-hour speech on Wednesday, writes Diana Choyleva in the latest Enodo Weekly.
The good news in the slew of data is that China’s rebalancing is continuing. Investment is falling while consumer spending is growing. For now, the Chinese people are likely to be content with their improving material well-being.
- China’s official figure for Q3 real GDP growth came in today bang on expectations at 6.8%
- This is no surprise to markets, especially as the release coincides with the crucial 19th Party congress
- But behind the favourable growth number lies a dangerous trend – accelerating inflation
- China’s official GDP deflator shows inflation quickening to 4.5% in Q3 from 0.2% in Q1 2016
- Markets are not prepared for China exporting inflation
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