China Beige Book: The economy contracted in Q2

Dhwani Mehta FXStreet

China Beige Book, a survey of more than 3,300 Chinese companies conducted mid-May to mid-June., showed on Wednesday, the economy contracted in Q2 (the three months April to June) from a year earlier.

Additional findings

“Historically low levels of manufacturing profits, capital expenditures and retail sales volumes, barely up from Q1.”

“Slow global demand remains a drag on growth.”

"The eventual return to growth does not mean a return to anything approaching the old levels of growth."

"Until and unless global demand recovers more forcefully, the incremental quarterly improvement just seen will make for a contraction for full-year 2020."

Market reaction

The market mood remains cautiously optimistic, as investors weigh in the surge in the new coronavirus cases globally.

AUD/USD trades choppy around 0.6950 so far this Wednesday while USD/JPY consolidates around mid-106s, as the dollar continues to remain on the back foot.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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