With the release of the and GDP figures, Q1 is behind us. Amidst the great uncertainty, there is at least one thing that is clear. The current quarter is going to be worse, even if not for China. The good news is that with lockdowns gradually easing, the US and European Union, and parts of Asia are probably near the peak of the economic contraction.
The March data suggested China was likely past its low point, and the April , if one accepts it as face value, shows the domestic economy is gaining traction. The rose to 53.2 in April, which is above the six-month, 12-month, and 24-month averages (49.5, 51.6, and 53.0, respectively). Fears that China will take advantage of the situation to buy depressed assets are prompting many countries to look to tighten up rules about foreign direct investment, especially by state-owned companies. There also appears to be greater sensitivity to sectors, such as medicine and medical equipment, in which officials want to discourage foreign…
