Macroeconomic roundup: China’s debt climbs to $US25 trillion

Join NBR's Jason Walls as he breaks down the week's biggest macroeconomic stories. With special feature audio.

The world’s second-biggest economy is also one of the world’s most in debt, with new figures revealing the extent of China’s debt level.

Total debt rose to 237% of GDP in the first quarter of this year which, according to the Financial Times, puts the People’s Republic $US25 trillion in the red.

Although the size of the debt remains a problem, it’s how quickly it has been racked up that is making analysts uncomfortable.

In the first quarter of 2007, Chinese debt was 148% of GDP.

Earlier this year, Goldman Sachs' Ha Jiming said: "Every major country with a rapid increase in debt has experienced either a financial crisis or a prolonged slowdown in GDP growth."

Meanwhile, the US Federal Reserve opted to keep its interest rate on hold this week.

Chairwoman Janet Yellen was worried about the global economy and low inflation but was upbeat on the US economy, saying labour market conditions “have improved.”

But there are concerns over the economic future of the UK as the “Brexit” looms.

Growth figures from the UK showed a 0.4% gain in GDP for the first quarter of this year.   The world’s second-biggest economy is also one of the world’s most in debt, with new figures revealing the extent of China’s debt level.

Total debt rose to 237% of GDP in the first quarter of this year which, according to the Financial Times, puts the People’s Republic $US25 trillion in the red.

Although the size of the debt remains a problem, it’s how quickly it has been racked up that is making analysts uncomfortable.

In the first quarter of 2007, Chinese debt was 148% of GDP.

Earlier this year, Goldman Sachs' Ha Jiming said: "Every major country with a rapid increase in debt has experienced either a financial crisis or a prolonged slowdown in GDP growth."

Meanwhile, the US Federal Reserve opted to keep its interest rate on hold this week.

Chairwoman Janet Yellen was worried about the global economy and low inflation but was upbeat on the US economy, saying labour market conditions “have improved.”

But there are concerns over the economic future of the UK as the “Brexit” looms.

Growth figures from the UK showed a 0.4% gain in GDP for the first quarter of this year.   

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