The Day at a Glance | October 19 2020

The Top

· China`s economy grew less than expected in the 3Q20 (4.9% annual vs 5.5% e.) but confirmed a solid recovery.

· Nancy Pelosi affirmed that Tuesday is the deadline to reach a fiscal agreement before the election; reviving hopes of an agreement.

· Jerome Powell will give a speech at an event with economists today.

· More than 40 million COVID-19 cases have been recorded at a global level.

Economic environment

China`s GPD expanded 4.9% at an annual rate in the third quarter of the year. The figures set slightly below estimates but confirm a strong recovery given the growing levels in global demand and the country`s control over the virus. Monthly retail sales figures (3.3% annual in September), industrial production (6.9%) and investment (0.8%) showed improvement and boosted expansion during the 3Q20 along with a decreasing rate of unemployment (5.4% in September). The strong increase in imports in recent months subtracted importance from the rise in GDP, however, this is good news since it reflects a recovery in China`s domestic market. In the January-September period, the economy expanded 0.7% compared to 2019; in other words, the Chinese economy has already recovered what it lost during the first months of the year. Notwithstanding, it still shows weakness regarding a recovery in services (tourism, education) and the economy has not been able to operate to its full potential. China`s recovery is expected to continue during the 4Q20, making its economy the only one to record growth this year.