Behind the headlines, China's slowdown undermines the global economy

<p>Kia ora,</p><p>Welcome to Monday’s Economy Watch where we follow the economic events and trends that affect Aotearoa/New Zealand.</p><p>I'm David Chaston and this is the international edition from Interest.co.nz.</p><p>And today we lead with news the threat of the Chinese economic slowdown hangs over the global economy and now they are staring at imminent deflation.</p><p>But first we should note, there was a right-shift in the political mood evident in weekend voting in both <a href="https://tallyroom.aec.gov.au/ReferendumNationalResults-29581.htm" target="_blank"><strong>Australia</strong></a> and <a href="https://www.electionresults.govt.nz/" target="_blank"><strong>New Zealand</strong></a>. There is also <a href="https://www.reuters.com/world/europe/poland-holds-high-stakes-election-amid-rows-over-democratic-rule-2023-10-15/" target="_blank"><strong>a key election going on in Poland</strong></a> that is worthy of our attention. Locally, early celebrations by the winning parties may be followed by nervousness, as the late and overseas votes get counted. It may herald complex coalition negotiations.</p><p>Coming up this week, the big economic issue will be the release of our inflation rate for Q3-2023 on Tuesday. Markets currently <a href="https://www.interest.co.nz/economy/124662/sake-its-credibility-reserve-bank-needs-see-some-meaningful-easing-domestic" target="_blank"><strong>expect</strong></a> the headline CPI rate to be 5.9%, down only marginally from 6.0% in Q2-2023. But if it does come in at that level, that will represent no material progress from the RBNZ's perspective.</p><p>In the United States, a key focus will be on the onset of the earnings season featuring major players like Tesla, Bank of America, Johnson & Johnson, Procter & Gamble, and Netflix. Also, investors will be paying attention to Fed speeches, and data including retail sales, building permits, housing starts, existing home sales, and industrial production.</p><p>Across the Pacific, China will grab attention this week with its Q3 G