China’s fourth-quarter GDP figure slips to 6.4% as trade war hits consumer sentiment

China’s economic growth sank to its lowest annual rate in approximately three decades last year as the US trade war and Beijing’s clampdown on a debt-fuelled corporate spending spree took their toll on Chinese businesses and consumers.

The 6.6 percent increase in the gross domestic product in 2018 was the lowest since 1990 when China was faltering from international sanctions following the Tiananmen Square massacre. It was down from 6.8 percent in 2017.

The data published last Monday also revealed the Chinese economy was proceeding to decelerate, growing just 6.4 percent in the fourth quarter, the lowest quarterly rate since the global financial crisis. Growth has now slowed for three successive quarters, prompting concern among investors that the country could drag down the global economy.

Beijing has used an array of fiscal and monetary stimulus measures since July to support investment and consumption, but the new data shows that the policies have so far failed to lift the slackening.

Despite the pessimistic forecast, financial markets across Asia took the announcement in their stride, with most significant indices ending the day flat or higher. Mainland China’s CSI 300 closed up 0.6 percent, with Hong Kong’s Hang Seng up 0.4 percent. The Topix in Tokyo was 0.6 percent higher and Sydney’s S&P/ASX 200 rose 0.2 percent.