A deepening slowdown in the world’s second-largest economy is unnerving investors, who have been focused more on the U.S. outlook.
On Tuesday, official data showed that China’s exports and imports each had double-digit drops in July, underscoring the weakness of the global economy. The Dow industrials closed down by almost 160 points or 0.5%. Oil futures moved lower after the development of China.
Instead of experiencing a surge in prices after the lifting of Covid-19 pandemic curbs late last year, China is suffering an unusual bout of falling prices for a range of goods, from commodities such as steel and coal to daily essentials and consumer products such as vegetables and home appliances.
While falling prices in China may help ease inflationary pressure elsewhere as Chinese exports become cheaper, they could become the source of another concern for the global economy.
For instance, a flood of low-price Chinese goods risks squeezing profits for producers in other countries and hurting employment opportunities. During the pandemic, many factories in China ramped production to accommodate a surge in overseas orders.
As demand in the West fades, producers of automobiles, consumer goods, and other products have excess inventory, forcing many to slash prices to reduce stockpiles.
Mexico and Canada have replaced China as the top providers of goods to the US as a nearshoring push encourages more diversified supply chains. The Asian country is now the third-largest merchandise provider to the US, behind Mexico and Canada.
China’s Largest Developer Defaults. Property Sector Faces Big Debt Problems.
A renewed downturn in the housing market has curbed Chinese consumers’ appetite for consumption since many households have treated apartment units as their main store of wealth, and are highly sensitive to fluctuations in home prices, said the chief China economist at Société Générale.
Proverbs 19:17 He that hath pity upon the poor lendeth unto the LORD; and that which he hath given will he pay him again.
Proverbs 22:9 He that hath a bountiful eye shall be blessed; for he giveth of his bread to the poor.
Proverbs 28:27 He that giveth unto the poor shall not lack: but he that hideth his eyes shall have many a curse.
Matthew 25:40 And the King shall answer and say unto them, Verily I say unto you, Inasmuch as ye have done it unto one of the least of these my brethren, ye have done it unto me.
Matthew 25:41 Then shall he say also unto them on the left hand, Depart from me, ye cursed, into everlasting fire, prepared for the devil and his angels:
Matthew 25:42 For I was an hungred, and ye gave me no meat: I was thirsty, and ye gave me no drink:
Matthew 25:43 I was a stranger, and ye took me not in: naked, and ye clothed me not: sick, and in prison, and ye visited me not.
Matthew 25:44. Then shall they also answer him, saying, Lord, when saw we thee an hungred, or athirst, or a stranger, or naked, or sick, or in prison, and did not minister unto thee?
Matthew 25:45 Then shall he answer them, saying, Verily I say unto you, Inasmuch as ye did it not to one of the least of these, ye did it not to me.
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