China is trying to keep its economic growth going with monetary expansion, a professor at Rutgers Business School, Newark and New Brunswick says.
Farrokh Langdana, professor of finance and economics and director of the Rutgers Executive MBA program, discussed China’s recent policy moves in an article on the school’s website.
Langdana writes that the strength of the U.S. dollar in August prompted China to “buy even more Yuan and sell even more foreign exchange reserves (FX).”
That move started to put a damper on economic growth, so China pulled back a little, Langdana writes. In October, China dropped interest rates for the sixth time this year.
“Both of these point to an increase in monetary growth,” Langdana writes. He expects the expansion will keep property prices in China increasing and the economy growing.
With infrastructure spending no longer booming, Langdana looks to private consumption as a possible driver of growth in China.
“The digital/financial revolution in online retailing has been one of the unsung successes of China, and perhaps the growth in private consumption … and in housing and the growth in the 2nd and 3rd tier cities will come to the rescue,” he writes.
Langdana teaches course including China Opportunities & Challenges and International Trade Strategy, according to his faculty bio. One of his specializations is international trade and global macroeconomic policy, and he is the author of “International Trade and Global Macropolicy.” He has taught in China and Singapore. You can watch his vide on “Liquidity Traps and Bubbles” on YouTube.