China Expected to Post Weak Q4 GDP

China is expected to post its weakest economic growth since the global financial crisis in the fourth quarter, adding pressure on policymakers to take more steps to ward off a sharper slowdown that could jolt global markets.

A renewed plunge in China’s stock markets and the yuan CNY=CFXS have stoked concerns among global investors about the health of the world’s second-biggest economy, although analysts see few signs of an abrupt drop-off in activity.

Growth in fourth-quarter gross domestic product likely slowed to 6.8 percent from the same period last year, down from 6.9 percent in the third quarter, according to a Reuters poll of 50 economists.

That would be the weakest pace of expansion since the first quarter of 2009, when growth tumbled to 6.2 percent.

The highest forecast in the poll was 7.1 percent and the lowest was 5.3 percent, though some investors fear current growth levels could already be much weaker than the official data will suggest.

“The weaknesses in both domestic and external demand have exacerbated the deflationary pressures in the economy,” economists Qu Hongbin and Julia Wang at HSBC said in a note.

“Going into 2016, weak domestic as well as external demand will continue to weigh on growth.”

via Reuters

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza