Wall Street Journal (January 29)
A “deflation doom loop” is “trapping China’s economy.” Despite the nation’s “extraordinary leaps in cutting-edge technology, from artificial intelligence to robotics,” China’s “relentless pursuit of growth through manufacturing has also created a lopsided economy, with much of it stuck in a deflationary spiral. China’s GDP deflator, a broad price gauge, has been negative since 2023, a sign of inadequate demand at home.”
Tags: 2023, AI, China, Deflationary spiral, Doom loop, Economy, GDP deflator, Growth, Lopsided, Manufacturing, Negative, Robotics, Technology
New York Times (September 16)
“While other countries have scrambled to meet President Trump’s demands to strike deals for reduced tariffs, China has kept to its own timetable.” The costly price has been a 15% drop in “China’s exports to the United States… so far this year.” China has successfully offset this with surging exports to other countries, but robust exports are “masking weakness in other parts of its economy. A persistent real estate downturn has wrecked [sic] havoc on the economy. Consumers are spending less, while joblessness among young people remains a major problem. China is also dealing with a stubborn deflationary spiral, spurred by overproduction in key industries and price wars.” Still, given its degree of media control, the Chinese government does not appear anxious about negotiating a trade deal with the U.S.
Tags: China, Consumers, Deals, Deflationary spiral, Demands, Downturn, Economy, Exports, Havoc, Joblessness, Overproduction, Price wars, Real estate, Spending, Surging, Tariffs, Trump, U.S., Weakness
