China's Scary Slowdown May Have Limits

Look for a pickup by yearend
Employees monitor the production of construction machinery at Sany Heavy Industry Co.'s assembly shop in Changsha, Hunan Province, China. Photograph by Nelson Ching/Bloomberg  

Has China’s economy hit bottom? There are plenty of signs that China’s economic engine is stalling. Export growth was nearly non-existent in July, increasing just 1 percent over the previous July. Meanwhile, growth in fixed-asset investment was flat, too. Growth in industrial production fell to 9.2 percent, compared to 9.5 percent in June. (The average monthly gain over the last 20 years or so has been more like 13 percent.) “China’s July macro data posted across-the-board weakness, with slowing domestic activity and a sharp deceleration in exports,” Barclays economists Jian Chang, Yiping Huang, and Steven Lingxiu Yang wrote in a report on Aug. 10.

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