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Due to the severe epidemic, China's GDP is likely to shrink in the second quarter

China strictly adheres to the zero-zero policy, and the economic situation is critical, causing headwinds to the global economy. Still, some strategists believe that China's woes will keep central banks from raising interest rates too aggressively and the global economy will be spared a recession. Barron's reported that China's Beige Book was released on the 2nd. The report surveyed more than 1,000 companies in the last week of April and found that the consequences of China's closure of cities to fight the epidemic have not yet been reflected in official data, but have brought "serious consequences". pressure". Nearly a quarter of companies admit to having an outbreak at their company, up from 20% in March. The China Beige Book pointed out that what is even more worrying is that since the outbreak of the epidemic in 2020, the employment situation of Chinese companies has been hit hard for the first time, with companies reducing hiring and wages falling. Businesses also lacked appetite for credit, with corporate borrowing and bond sales both declining. The Beige Book warned that people from all walks of life will pay close attention to how China handles the epidemic. If Beijing and other big cities are strictly closed like Shanghai, then China's GDP growth in the second quarter will not only slow down, but may also shrink.
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