(Opinion) The changing Chinese economy is impacting the world as prices for its major exports such as steel and cars decrease, reshaping global trade.
Companies in China face weaker demand at home. They’re selling goods abroad cheaper. This move is cooling inflation in other countries.
But it’s also sparking more competition over prices.
For the first time in months, China’s exports in dollars grew in November. They sent more goods to big partners, like the U.S. A weaker yuan is playing a part.
It’s making Chinese products cheaper overseas.
The steel industry shows what’s happening. Prices have fallen up to 40%. This has led to more exports.
Countries like Thailand feel the impact. Their own steel production might drop.
In autos, similar trends are seen. More Chinese cars are selling abroad. But their prices are lower.
This is partly because China is focusing more on electric vehicles now.
Consumer goods follow this pattern too. Items like appliances are cheaper by 10%. This links back to China’s struggling real estate market.
Fewer people are buying homes, so they’re buying fewer appliances.
Fastest Drop of Consumer Prices in Three Years
China’s consumer prices are also falling. This is the fastest drop in three years. It points to bigger issues in China’s economy.
Core inflation, which leaves out food and fuel, stays low. This shows demand inside China is weak.
China’s challenges include debt and a slow housing market. These issues have led to calls for more help from the government.
Moody’s, a big rating agency, warns China’s credit rating could go down. But China’s leaders are hopeful.
They plan to boost demand and the economy in 2024.
As China adapts, its actions affect the world. Its shift to cheaper exports and its own economic hurdles are changing global trade.
As a major economic player, China’s moves are key for everyone to watch.