Trade Wars Slam Chinese Retail Sales, Investment Growth Weakest In 21 Years

This, as the SCMP notes, is at the bottom end of China’s target range of 6 to 6.5% growth for 2019, and further indicates the continued downward pressure on the economy from the trade war with the United States as well as domestic headwinds.

“The economic slowdown is already a trend,” said former central bank adviser Li Yang, who heads the institute that is affiliated to the Chinese Academy of Social Sciences (CASS).

“We must resort to deepened supply-side structural reform to change it or smooth the slowdown, rather than solely rely on monetary or fiscal stimulus.”

The institute’s forecast is in line with the International Monetary Fund, and indicates the challenge that policymakers face to achieve the above 6% growth rate needed in 2019 and 2020 to reach the government’s goal of doubling GDP in 2020 compared to its 2010 level.

As a reminder, a GDP growth rate below 6% would be the first time since the aftermath of the 1989 Tiananmen crackdown.

Finally, we note that Navarro and his trade hawks in the White House will be pleased at these weak numbers. President Trump has repeatedly said that China needs a deal more than the U.S. does, and these numbers as leverage in their negotiations.

Story cited here.