China has come out with GDP slowdown. Fourth quarter GDP has been released which showed that China has just missed the expected rough GDP for this quarter. Everything seems fine for China right now.
According to the figures, China grew by 7.9% in this quarter. Finally annual growth has been 7.8% for 2012. Earlier, a prediction said that from 2012 to 2014, 7-8% increase would be seen. This target has been met. This quarter has also seen an increase of GDP from 7.4% in third quarter.
Fitch has come up with a fact that debt is posing a problem for China. This will result in negative `AA `rating and also burdens sovereign profile. It says that data shows that China needs to rebalance its economy.
China has many challenges in front of them. One of the problems is a restriction that is seen on capital funding. There is lack of activity from financial systems in the existing burden because of bank liquidity. China is at a risk of structural current account deficit. On consumption terms, China has not witnessed any improvement since years.
For future growth of economy, it is required that less investment constraints are seen. Rebalancing of the economy is required urgently by China.
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