China capex growth hits three-year low as weak economy, trade war drag

by accountinreddit

 

via reuters

Capital investment by Chinese firms has ground to its slowest pace in three years, as a weakening economy, tight credit and prolonged trade war with the United States dent sales growth and cash reserves, a Reuters analysis showed.

Capex Growth

Revenue grew 6.7%, the weakest in at least three years – the earliest period for which data from a comparable number of firms is available – while net profit rose 7.8% versus nearly 22% two years earlier.

Sales and Profit Growth

Interestingly the article ends as follows:

Car maker Zotye Automobile Co Ltd (000980.SZ) saw revenue in the September quarter drop 88% on year, and TV and smartphone maker TCL Corp (000100.SZ) cut capital expenditure by 72%.

Yet while earnings reports indicate a slowdown, growth in factory activity neared a three-year high in November, reinforcing upbeat government data released over the weekend.

My question is where people expecting 22% growth to go on forever?