China’s economy slumps as zero-Covid takes its toll

GGood morning

China is paying the price for its zero-Covid strategy as economic growth slowed to a crawl in the second quarter.

GDP grew just 0.4 percent over the period, well below forecasts and marking the slowest pace of growth since the first wave of the pandemic in early 2020.

Beijing’s brutal approach to halting new waves of the virus led to a nearly 14 percent plunge in Shanghai, which has faced some of the toughest lockdowns. A nationwide housing crisis is adding to the woes.

The data will add to investors’ fears of a global economic slowdown amid rising inflation.

5 things to start the day off right

1) The eurozone shook as Italy’s technocrats lost power The possible departure of Mario Draghi marks a dangerous moment for Italy and its economy

2) Amazon wants to employ more people in the UK than the army Shopping giant targets 75,000 employees in UK

3) Saudi Arabia gets a board seat at Aston Martin as it injects £200m The Sovereign Wealth Fund of the Gulf States plans to take a 20 percent stake in the luxury car brand

4) Solar panel owners only pay a fraction of what their electricity is worth A three bedroom household with solar panels should be able to earn in excess of £400 a year

5) Engine drivers announce new rail strike for July 30th Train drivers’ union Aslef strikes 48 hours after RMT industrial action

what happened overnight

Hong Kong stocks fell more than 1 percent this morning, while the Hang Seng Index fell 1.1 percent.

The Shanghai Composite Index fell 0.6 percent, while the Shenzhen Composite Index on China’s second bourse fell 0.3 percent.

Tokyo shares opened higher, with the benchmark Nikkei 225 index up 0.4 percent.

Comes today

  • Company: Burberry, Ninety One (Trade Update)
  • Business: GDP (China), Retail Sales (US, China), Industrial Production (China), Michigan Consumer Sentiment Index (US), Trade Balance (EU) China’s economy slumps as zero-Covid takes its toll

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