From The Hill: 2024-03-29 08:47:08

China has been struggling to stabilize its equity and property markets, with the stock market falling behind the S&P 500 since 2017. Losses in value now reach over $6 trillion, and record numbers of young people are unemployed. Policymakers are trying to boost confidence, focusing on economic reforms to increase domestic consumption.

Despite their efforts, China’s excess savings remain a major issue. The country generated 28 percent of global savings in 2023, according to the IMF, with implications for global interest rates. However, if domestic consumption does not rise and the budget deficit persists, capital flight and trade disputes may escalate, particularly in the electronic vehicle sector.

The property sector continues to weigh on consumer confidence in China, with a significant number of households facing income declines and job insecurities due to the pandemic. Homeownership is a key asset for many families, but as economic challenges persist, the government must address structural issues to rebuild confidence and shift towards a consumption-driven economy.



Read more at The Hill: Foreign investors aren’t the only ones bailing on China