China's Economic Growth immersed below 7% for the first time
China's economic growth immersed below 7% for the first time since the universal financial crisis which has led to rise in pressure on Beijing to decrease interest rates and take extra measures to stir up activity.
The National Bureau of Statistics said that the China’s economy grew 6.9% between July and September, which is slightly better than what was forecasted but down from previous three months.
China is expected to avoid a sudden fall-off in growth, while analysts predicted a steadier slide in activity stretching into 2016.
Julian Evans-Pritchard, an analyst at Capital Economics in Singapore said, “Underlying conditions are subdued but stable. “Stronger fiscal spending and more rapid credit growth will limit the downside risks to growth over the coming quarters”.
Chinese leaders have been reassuring global markets that the country’s economy is under control after an astonish devaluation of the yuan. Economists at ANZ Bank said in a note to clients that as growth diminishes, China needs to cut reserve requirement ratio (RRR) by an extra 50bps in Q4.
In its encounter against worst economic condition in China, the central bank has dropped interest rates about five times since November last year. Adding to that, it diminished banks' reserve requirement ratios three times in 2015.
Despite the increase of easing, Monday's GDP reading was still the most awful since the first quarter of 2009, when growth fell down to 6.2%.
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