Page 9 - Policy_Economic_Report_September2020

Policy and Economic Report:
Oil & Gas Market

China

Even as the Chinese economy is set to post its weakest growth in decades, the economic activities in the
country are on the path of recovery in the second quarter of 2020. The recovery in the economy is being
fuelled by strong growth in real estate output and industrial output. However, the private consumption
growth still remains lower than the pre-COVID levels. Through the month of July, the services sector in
China has shown a robust growth. Auto sales in the country, which is also a broad representative of
consumer spending, continued to rise for the fourth straight month, recording a 16.4 per cent increase in
July. Further the sales of the new energy vehicles during the period increased by 19.3 per cent YoY.

China Industrial Production

Supported by policy measures and a possible recovery in the services sector, Chinese economy is most
likely to maintain its recovery progress. However, risks may arise mainly due the ambiguous status of the
phase one trade deal, along with slower growth in domestic demand and the fear of a rise in COVID-19
infection rates in winter. Consequently, China’s general manufacturing PMI increased to 53.1 per cent in
August from 52.8 in July.

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September 2020