China’s economy slowed rapidly in April as the costs of both a worsening Covid outbreak and the nation’s stringent approach to eliminating the virus took their toll, reported Bloomberg.
That’s the outlook from Bloomberg‘s aggregate index of eight early indicators for this month. The overall gauge fell below the mark that separates improving from deteriorating conditions, and hit the worst level since April 2020, suggesting the current wave of outbreaks has dealt a serious blow to the economy.
China’s actions to support the economy will be vital to the global recovery, the head of the International Monetary Fund has said, warning that a prolonged slowdown would have substantial spillover effects.
IMF Managing Director Kristalina Georgieva said on Thursday Beijing had room to take measures to prop up growth amid a deteriorating outlook for the world’s second-biggest economy.
The Asian region faces stagflationary outlook, with growth being lower than previously expected and inflation being higher.
The larger-than-expected slowdown in China due to prolonged or more widespread lockdowns, longer-than-expected slump in the property market, constitutes a significant risk for Asia.
Fears of total lockdown have been fed by disruptions in the supply of food, medicine and daily necessities in the southern business hub of Shanghai, where 25 million residents have only gradually been allowed to leave their homes after three weeks of confinement.
