Study Puts China Investment PPP at 2.6 Yuan per Dollar, Lifting Global Growth Weight
Updated
Updated · South China Morning Post · Jun 1
Study Puts China Investment PPP at 2.6 Yuan per Dollar, Lifting Global Growth Weight
1 articles · Updated · South China Morning Post · Jun 1
A new think-tank study says China’s role in global growth is larger than standard measures show, estimating an investment purchasing power parity of 2.6 yuan per U.S. dollar.
The note argues common international metrics miss China’s advantage because investment goods there cost about 37% of U.S. levels, widening its real physical investment lead over the United States.
Researchers said that distortion means China’s contribution to global growth and the spillover from swings in its economy are likely being underestimated.
The study comes as Beijing seeks to expand its economic and financial influence, and it argues that as the economy recovers and prices rise, the yuan could move closer to that stronger fundamental valuation.
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