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China: Domestic demand weakens – Standard Chartered
Key Takeaways (30s Read)
China's domestic demand shows signs of weakening, prompting policymakers to stabilize investments.
According to Standard Chartered, China's domestic demand is reported to be weakening. November's industrial production (IP) shows a year-on-year growth of 4.8%, primarily due to a rebound in exports following a trade deal. However, investments in real estate and infrastructure (FAI) have declined more severely, raising concerns about the weakening of domestic demand. The Chinese government has indicated plans to stabilize investments, and the specific measures to be implemented are under scrutiny. The current state of the Chinese economy could significantly influence future market trends. Particularly if domestic demand does not recover, there is a risk of adverse effects on other economic indicators. As a result, investors may need to reassess their interest in assets related to China.
AI Analyst
AI Opinion
"The vulnerabilities of the Chinese economy are becoming apparent, with the weakening of domestic demand potentially affecting the wider market. While November's industrial production indicates growth compared to the previous year, the decline in real estate and infrastructure investments clearly suggests a drop in consumer confidence domestically. The government’s planned policies to stabilize investment are crucial, but their effectiveness is called into question. If recovery in domestic demand is not observed, worse performance in other economic indicators can be anticipated, and investors should maintain a cautious stance. Especially for assets highly dependent on the Chinese market, effective risk management will become increasingly important."
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