Home ›› 27 May 2022 ›› Stock
Asian markets mostly fell Thursday as Chinese Premier Li Keqiang warned the world’s number two economy was in some ways worse off now than during the early days of the pandemic.
Li’s comments dealt a blow to confidence from the start and overshadowed a positive lead from Wall Street fuelled by minutes indicating a less hawkish stand from the US Federal Reserve.
The wind was immediately taken out of traders’ sails as they digested the warning, which comes as China persists with a zero-Covid policy to eradicate the fast-spreading Omicron virus variant.
The economic agony caused by lockdowns and other strict containment measures hammered growth across China and sent shockwaves globally as key supply chains were brought to a halt.
Data in recent weeks have shown that a series of pledges by Beijing to kickstart growth has essentially fallen flat owing to a lack of concrete action, while analysts say the easing of the Covid policy was the only thing investors wanted to see.
“Economic indicators in China have fallen significantly, and difficulties in some aspects and to a certain extent are greater than when the epidemic hit us severely in 2020,” Li told an emergency meeting Wednesday with representatives from local governments, state-owned companies and financial firms.
He also urged officials to work to pull unemployment down. There is a general feeling among commentators that China’s economic growth will fall well short of the government’s target of about 5.5 per cent. Expansion came in at 2.2 per cent in 2020.
