Despite firing several monetary easing bullets into the economy by the Central Bank of China, it still misses the shot on economic recovery. Despite multiple interest cuts and more cuts in the Reserve Requirement Ratio (RRR) for the commercial banks China still is amidst a failing global recovery. The latest figures don’t seem to be in favor of the world’s second largest economy.

The fixed asset investment and retail sales data that came out Thursday 9^th August are below market forecasts along with the industrial production level data. China’s factory output growth has now reached a lowest in three years which analysts believe will be a detrimental factor to halt the China’s growth rate at around 7.5%. The estimated growth rate previously was 8% which has already faced a revision. China’s production output has come down to 9.2% from 9.5% in June which is the lowest since May 2009.

China’s economic woes are clearly an effect of the ailing economy of the US and the Euro Zone where seriousness of economic downturn is ever increasing.  China is selling very less to the European countries what it was selling previously. Export orders of China this July fell to a steepest level in eight months. The trade surplus rose to $25 billion compared to $31.5 Billion from the previous year. The CPI remaining at a record low of 1.8% from a 2.2% indicates the fact that the previous easing were of no significance in increasing domestic consumptions. Consumer demand for imported goods has also come down signaling the Central Bank to bring in more easing into the economy to garner consumer’s confidence.

China has already seen interest cuts in both June and July and the Central bank also helped to free $191 Billion into the economy by cutting down the RRR from the commercial banks.  Moreover, analysts are expecting some more interest cuts and RRR that will bring some ease in the market. But it is still ambiguous whether China’s economy will heal despite the absence of a global economic recovery.