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Two Charts to Explain the Current State of the Chinese Economy

by | October 18th, 2012 | 11:04 am

The third quarter GDP number for China was released today, showing a decline in growth to 7.4 percent (compared to 9.1 percent a year ago). Instead of a long post reiterating all the factors at play, sometimes a chart or two can sum things up succinctly.

Here are the two most important graphs for understanding the slowdown.

Real Estate Investment (percent growth YoY):

Exports to Europe (percent growth YoY):

The crackdown on the residential real estate market and the ongoing crisis in Europe continue to restrain economic growth in China.