China's economy shrinks and requires a bigger stimulus

Summary

The Chinese government has announced that its GDP has fallen by 6.8% YoY in the first quarter of 2020. The reduction is slightly more than expected and is a result of the unprecedented economic turbulence caused by the COVID-19 outbreak in the country.

Key points

• Key points:
• The rapid recovery of industrial production suggests that the negative impact of the COVID-19 outbreak on supply chains could be temporary.
• Several production activities came to a halt in February due to isolation measures; these activities are now quickly recovering as the population returns to work.

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