Deflation Is The Last Thing China’s Recovery Needs

It’s unfortunate because, after a mid-year retreat in growth, things had been looking a bit better. The economy expanded faster than anticipated last quarter, and a string of investment banks lifted their forecasts, UBS AG and JPMorgan Chase & Co. among them. The International Monetary Fund sounded upbeat. Imports are growing and car sales are on the rise, according to figures this week. Zhang Qingsong, deputy governor of the People’s Bank of China, was upbeat. “You may ask me, are you worried? No, not always, not too much,” he told bankers on Tuesday. He was talking about long-term prospects, but near hurdles need attention.

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