Preparing for China's landing

The People’s Bank of China (PBoC) is an exception among large central banks in cutting interest rates. Contrary to most other central banks that are struggling to tame inflation, the PBoC is responding to weakening growth prospects and declining prices. Although the Chinese government expects the economy to grow by about 5 per cent in 2023, economists believe it will be much lower. Some longer-term projections suggest growth will slow down to 2-3 per cent by the end of the decade. Notably, the Chinese economy expanded at an average annual rate of 9 per cent between 2000 and 2019 and has been the biggest driver of global growth. This sharp slowdown can have a range of implications, both for the