A slew of concerning economic data has been released today, indicating that all over the world falling oil prices and continued problems in China are having an effect on the global economy.
China
Whilst shares in China have steadied this morning after the tumultuous volatility seen last week, figures have indicated that one of China’s biggest e-commerce companies, Alibaba Group Holding, is expected to post its weakest quarterly revenue growth on record.
Alibaba’s revenue for the quarter ending December is projected to grow at 26.6 percent, according to a Thomson Reuters SmartEstimate survey of 28 analysts, which would be the slowest rate since the company started publishing such data three and a half years ago.
Earlier this month, Alibaba Chief Executive Daniel Zhang announced that the company would continue to target China’s largest cities including Beijing, Shanghai, Shenzhen and Guangzhou, where demand is highest, after previously pointing in the direction of a push into China’s vast countryside.
Russia
Over in Russia, oil’s rock-bottom prices have hit the economy hard, seeing a 3.7 percent contraction in 2015, according to preliminary figures published by the country’s statistics service. Retail sales dropped around 10 percent and capital investment fell by 8.4 percent.
Russia’s economy relies heavily on oil exports, and which the price of oil down 70 percent over the last 15 months Prime Minister Dmitry Medvedev has warned that Russia’s 2016 budget may have to be revised.
Japan
The latest export data from Japan, also released today, suggests that the country may be strongly affected by the slowdown in China: exports fell by 8 percent in December from a year earlier.
However, markets across Asia have risen this morning, mostly trading up around 1 percent and propping up global economies alongside it. This January has seen the worst start to the year in financial history, with European markets continuing to be affected by problems in China and a falling investor sentiment.
25/01/2016
