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China to lead world into moderate recession

Massive "helicopter money drop" is one way to mitigate a downturn.

The chances of an export-led recovery in China are minimal as the global economy has slowed down and China has lost its status as the low-cost manufacturing hub of the world because of rapidly rising unit labour costs and the continuing close link between the appreciating US dollar and the yuan.

WE believe that a moderate global recession scenario has become the most likely global macroeconomic scenario for the next two years or so. The most likely scenario in our view for the next few years, with a 40 per cent probability, is that global real gross domestic product (GDP) growth at