- China’s post-pandemic rebound hasn’t materialized and it faces mounting economic obstacles.
- Beijing is grappling with declining trade and foreign investment, a shaky housing market, and deflation.
- Experts say most of China’s issues are self-inflicted, and warn that policies must change to improve confidence.
The pandemic rebound that China and the rest of the world were anticipating has yet to materialize, and official data suggests there’s a long road ahead before the economy is back on its feet.
China’s National Bureau of Statistics announced Wednesday that consumer prices dropped annually in July for the first time in two years, dipping 0.3%, just slightly better than median estimates for a 0.4% decrease.
The People’s Bank of China is now facing the opposite problem of the Federal Reserve, which has tightened policy for 18 months in a bid to tame soaring prices. Deflation — the trend of prices falling throughout the economy — presents a particularly dangerous trajectory for China, which carries a massive amount of debt.
