Donald Trump gloats as China's GDP growth slows to 27-year low
US president says new data shows tariffs are having ‘major effect’
Donald Trump claimed that US trade tariffs were having “a major effect” on China after it was revealed that the country’s economy grew at its slowest pace since the early 1990s in the second quarter.
According to new data, the country's GDP grew at 6.2%, the slowest quarterly growth rate since 1992 and down from 6.4% in the previous quarter.
Taking to Twitter, the US president, wrote that “the United States Tariffs are having a major effect on companies wanting to leave China for non-tariffed countries. Thousands of companies are leaving. This is why China wants to make a deal.”
CNN said the data come after China posted a fall in both exports and imports for the first six months of this year, “indicating the toll the trade war is having on an economy already suffering from weaker domestic demand”.
However, Ken Polcari, managing principal at Butcher Joseph Asset Management in New York, told Reuters: “We knew it was going to be weaker, we knew the trade war was going to have an impact. What is next is the People’s Bank of China remains stimulative, they remain accommodative to the country.”
Experts say that there could be further declines in the Chinese economy. The country's National Bureau of Statistics also warned in a statement that the Chinese economy will continue to face “downward pressure” in the second half of this year.
It added: “The Chinese economy is still in a complex and grave situation. Global growth has slowed and external uncertainties are on the rise.”
Nie Wen, an economist at Hwabao Trust, told The Independent: “China's growth could slow to 6-6.1 per cent in the second half”.
Experts predict that Beijing will unveil more stimulus measures to stabilise growth, including boosting infrastructure spending and possible interest rate cuts by the country's central bank.