FINANCIAL markets started September as they ended August, with share prices falling and investors fretting about China’s cooling economy. The latest sell-off was triggered by a survey of Chinese purchasing managers which suggested that manufacturing had contracted in August. Nerves were further pinched by grim data on exports from South Korea, on manufacturing from Taiwan and on growth from Brazil. Rich countries are also affected: GDP in Australia, a big exporter of raw materials to China, slowed almost to a standstill.
Amid the misery in emerging markets, one economy stands out for its comparative resilience. Figures released at the end of August showed that GDP rose by 7% in the second quarter, year on year. India’s official growth rate is thus on a par with China’s and much stronger than that of trouble spots such as Brazil, Russia and South Africa (see chart).
As in China, the GDP figures probably overstate...Continue reading
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