During last few weeks, China’s economic performance has been grim. Paradoxically, it reflects the shift to new kind of growth. July was not a good economic month in China, except for exports. More bad signs of sluggishness came with the preliminary August manufacturing data.
In China, an array of indicators seem to reflect faltering growth, from industrial output and retail sales to electricity production, imports and government revenues.
The new normal is reflected by a sharp decline in credit, weak domestic investment demand and a third consecutive monthly decline in housing sales. Recently, the great challenge of Premier Li Keqiang has been to manage the housing market volatility, while continuing deleveraging in the local government.