JERUSALEM – U.S. Treasury Secretary Steven Mnuchin dismissed concerns that China’s weakest economic growth since the global financial crisis could spill into other emerging markets and destabilise U.S. financial markets.
China is trying to navigate through multiple challenges after its trade war with the United States sparked a blistering sell-off in domestic stock markets and a steep decline in the yuan versus the dollar, heightening worries about its growth outlook.
“I am not concerned about that destabilizing our markets,” Mnuchin said in an interview with Reuters in Jerusalem at the start of a Middle East visit and after data on Friday showed a cooling U.S. economy.
“Broadly, right now, I don’t see a contagion risk,” he added.
The Chinese economy’s year-on-year growth was 6.5 percent in the third quarter, compared with an expected 6.6 percent and the 6.7 percent achieved in the second quarter, the National Bureau of Statistics said on Friday.
It marked the weakest year-on-year quarterly gross domestic product growth since the first quarter of 2009 at the height of the global financial crisis.
Beijing and Washington have slapped tit-for-tat tariffs on each other’s goods in recent months, sparked by U.S. President Donald Trump’s demands for sweeping changes to China’s intellectual property, industrial subsidy and trade policies.
Plans for bilateral trade talks to resolve the dispute have stalled, triggering a domestic equities rout and putting pressure on China’s softening economy and weakening currency.
Asked whether the slowing economy in China underscored the need for talks, Mnuchin said: “No, the importance is that we are focused on having a more level playing field in our economic relationship with them.”