The South African rand has long served as a sort of early warning system for investors to gauge the impact of Chinese economic news. And on 18 October, the alarms sounded as the value of the South African currency fell 1.1% in response to worse-than-expected third-quarter data that revealed the Chinese economy slowed to its slowest pace in a year.
The economy grew just 4.9% in three month period between July and September, according to the National Bureau of Statistics, down sharply from the nearly 8% growth rate in the second quarter. Industrial production, a key data point for Africa’s commodity-exporting countries, was flat with just 0.1% growth.
Although the Chinese economy performed much better than other major economies in Asia, Europe, and the US throughout the pandemic era, that may no longer be true as a series of events have converged in recent months that together present the
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