Fifty-nine percent of respondents said China’s gross domestic product, which rose 9.5 percent last quarter, will gain less than 5 percent annually by 2016. Twelve percent see such a slowdown within a year, and 47 percent said it will occur in two to five years, the quarterly Bloomberg Global Poll of investors, analysts and traders who are Bloomberg subscribers showed.
Now, four years into a financial crisis triggered by the collapse of the U.S. mortgage-securities market, some investors are beginning to doubt China’s staying power. Investors labeled the Chinese economy as “deteriorating” rather than “improving” by a nearly three-to-one margin, 38 percent to 13 percent. A plurality of 47 percent called it “stable.”
Investors’ outlook for the world’s second-largest economy clashes with that of China economists including those at HSBC Holdings Plc, Nomura Holdings Inc., Capital Economics and the nation’s State Council, or cabinet equivalent. Lu Zhongyuan, deputy director of the State Council Development Research Center, said at a briefing in Beijing yesterday that growth in the next five years will likely exceed 8 percent.
China’s coal mining industry is a barometer of gathering signs of economic weakness, said Michael Shamosh, chief investment officer at Corby Capital Markets in Boston. Yanzhou Coal Mining Co., China’s fourth-biggest producer of the fuel, has dropped about 46 percent since a high on May 31 in Hong Kong trading.
“Something is amiss,” Shamosh said. “Nothing is more important to China than coal.” He said a decline in the price of copper, down almost 25 percent since Aug. 1, is another indicator of a slowdown, because China’s urbanization and housing boom made it the world’s largest consumer of the metal.