China has finally overtaken the U.S. in terms of purchasing power according to International Monetary Fund. The IMF measures economic strength by Gross Domestic Product (GDP) in both market exchange rates and average purchasing power, the latter being where China has overtaken the U.S. with a GDP of $17.6 trillion by the end of 2014 — 16.4 percent of the world’s purchasing power. The U.S. will close out the year with a purchasingpower adjusted GDP of $17.4 trillion, or 16.2 percent of the world’s total. These figures are adjusted for the relative costs of living in both countries, and experts have acknowledged the difference in lifestyle and spending habits that have influenced the results. The U.S. however still maintains its dominance in raw terms, at more than $6.5 trillion above China.
