The baleful signal about China’s economy given at the beginning of the year is getting stronger and Chinese consumers are losing their confidence.
According to Westpac-MNI, China’s leading consumer strength gauge consumer sentiment fell 2.2% to 111.5%.
A reading of 100 is termed as neutral. A neutral reading defines the pessimists and optimists are equal in number. But the reading above 100 indicates that there are more optimists than pessimists right now.
Last year China’s GDP growth was almost 7%. For many countries around the world, the percentage is a quite a good rate of growth, but for China, the growth rate is the lowest for the last 25 years.
In August four of the survey’s five components weakened which shows China’s economic weakness. Some other significant factors of the economy are negatively moving, export is decreasing, domestic demand is sluggish, debt is high, investment is slowing, the cheap labor pool is contracting and so forth. While the economic fiasco is ripple out some economists are speculating that to earn a GDP growth of 6.5% will be tough for China.
Apart from the entire plummet, there are some other components are rising affluently. Durable buying condition rose by 2.1% in July. Country’s car industry is still booming since people are showing interest in buying upgraded car.
Chinese economic dreariness can be removed if government reforms its complex economic system, though it will take minimum 5 years.