Sharechat Logo

Coronavirus May Drag China GDP Down to 4.5% in First Quarter

Friday 31st January 2020

Text too small?

China’s economy may grow just 4.5% this quarter, down from 6% in the prior three months, if the coronavirus inflicts a severe yet temporary impact on output, according to Bloomberg Economics.

Such a slowdown would be 1.4 percentage points beneath the forecast made before the outbreak of the virus which is now threatening to hurt demand and supply chains in China and beyond, economists Chang Shu, Jamie Rush and Tom Orlik wrote in the report, which was published on Thursday.

The projection is based on the experience of the 2003 SARS outbreak as well as changes in China’s economy since then. A second quarter recovery would pave the way for growth of 5.7% over the entire year, lower than 2019’s 6.1% and 0.2 point below the previous prediction.

Beyond China, Hong Kong faces the biggest risk with 1.7 percentage points lopped off economic growth this quarter -- if the virus delivers a severe, but short-lived impact. Neighbors South Korea and Japan are also set to suffer, while the U.S. and euro are face drags of around 0.1 point, according Bloomberg Economics.

If the outbreak proves prolonged and the virus isn’t contained until the second quarter, then China’s 2020 growth rate could slow to 5.6%, the economists said.

(Bloomberg)



  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

Managed Exit From Togo Group
SkyCity on S&P negative credit watch
Coronavirus sell-off leaves investors keeping their distance
Proposal for VHP ASX foreign exempt listing not proceeding
The Reserve bank’s temporary ban affects more than $1b of securities
Yesterday Kathmandu confirmed it was raising $207m in order to cope and help it survive the turbulent Covid -19 pandemic
Rabobank Results
NZ banks not allowed to pay dividends until recovery, RBNZ announces
RBNZ changes affecting ANB Capital Notes
Trading update and completion of big chill acquisition

IRG See IRG research reports