Tuesday, May 30, 2023

China’s retreat from the economic crisis in Europe and the US threats?

Investor confidence in China was pressured last year by the strict Covid Zero policy and regulatory uncertainty. Now they have been restrained and the policy makers have sent clearer signals about the organization. “The momentum of activity could increase from now on, with the improvement in car sales and the stabilization of real estate sales,” Citi economists note in a recent report collected by CNBC.

According to them, the Chinese could be more likely to accelerate economic growth among their global counterparts, while the US and European economies face increased risks of economic turmoil.

“For a long time there has been a lot of discussion about our view that China could be big for growth this year; If anything, recent global banking tensions have strengthened this thesis,” says the team led by China’s chief economist Xiangrong Yu.

“China is at least a relatively safe harbor given its growth premium, financial resources, political discipline, and a new cycle of political economy,” experts from a US firm said. As a point, they cite in favor of the decision of the People’s Bank of China to cut the corresponding subsidy program, which in their opinion shows “the strengthening of political support in the midst of global volatility.”

This ratio is a measure of the amount of cash that banks in China need to hold. The PBOC said that, effective March 27, it will lower the interest rate on banks by 20 basis points. Since the pandemic began, China has kept its monetary policy relatively loose, without announcing large stimulus packages for such large groups of consumers.

“Perhaps learning from the situation of the United States in recent years, the People’s Bank of China has been prudent in managing finances, even during the pandemic,” and can quickly transfer to the plot and mode once growth is back. on track, say expert citizens.

Nation World News Desk
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