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An emerging COVID outbreak and a property crisis, unexpectedly slows China's Economic growth

A cumulation of decisions like the Zero Covid Policy and a severe property crisis, atop of which the central bank slashed the lending rates, All led to China's slow growth on the factory and retail front in the month of July.


Narrowly escaping a contraction in the June quarter, A severe lockdown of the commercial hub of Shanghai and a consumer market spending fall all led to such a situation.


Along with eradication of the newly formed clusters of the omicron variant, Policymakers were handed a very fragile task wherein they had to balance a fragile economy and the Covid crisis. In order to push the growth rates, the Central Bank unexpectedly lowered interest rates on key lending facilities, creating a liquidity trap.



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