World’s second largest economy… China faces economic contraction

Heba Press: Agencies

Recent economic data suggest that the contraction that has gripped China’s economy since last year has begun to deepen, raising concerns about the outlook for the world’s second-largest economy and reinforcing calls for immediate policy action.

Data released Monday showed that consumer price growth – with the exception of food – was virtually non-existent across large sectors of the economy, at a time when incomes are falling, according to Bloomberg.

The GDP deflator — a broader measure of price changes in the economy as a whole — is expected to continue falling through 2025, according to Bloomberg Analytics and analysts at banks including BNP Paribas. If that trend continues, it will be the longest period of contraction China has seen since data began collecting data in 1993.