Despite a series of economic shocks in the second part of last year, such as; power outages, defaults as a result of a slow-moving housing and property crisis, and Covid-19 outbreaks, in 2021, China’s economy grew by 8.1%.
This is according to official data from China’s National Bureau of Statistics released on Monday.
The People’s Bank of China surprised the market by reducing two key policy interest rates ahead of the GDP announcement, exceeding market expectations for stimulus.
What you should know
In December, consumer spending fell sharply as the government strengthened virus controls in numerous sections of the country.
It cut the one-year medium-term lending facility rate to 2.85% from 2.95% and lowered the seven-day reverse repurchase rate to 2.1% from 2.2%.
It also injected more liquidity by offering 700 billion yuan ($110 billion) of MLF loans, exceeding the 500 billion yuan maturing, and added 100 billion yuan with seven-day reverse repos, more than the 10 billion due.
The Bureau of Labor Statistics said that industrial production increased by 4.3% in December compared to the same month a year ago, exceeding expectations of 3.6% growth.
Last year, trade was a bright area, with exports reaching a new high of $3.36 trillion for the entire year of 2021, because of increased demand for Chinese goods from the United States, Europe, and Asia.
In the final three months of the year, the economy grew 1.6% on a quarter-on-quarter basis, stronger than the revised 0.7% in the preceding three months.
Fixed-asset investment rose 4.9% y/y in 2021. Property investment was up 4.4%, infrastructure investment gained 0.4% and spending in the manufacturing sector climbed 13.5%.
The unemployment rate rose to 5.1% at the end of December from 5% in the previous month.
