China’s Worsening Deflation Is Rippling Across the Globe

China’s economic slowdown, initially expected to drive a third of global growth, is causing worldwide concern. As China’s imports, including construction materials and electronics, decline, global economies are preparing for a significant impact. U.S. President Joe Biden referred to the situation as a “ticking time bomb.” Furthermore, global investors have withdrawn over $10 billion from China’s stock markets, both Goldman Sachs Group Inc. and Morgan Stanley have lowered their Chinese equity targets, with the former also highlighting potential regional spillover risks.