China's economy is No.2 by purchasing power

A World Bank reported has placed China ahead of Japan as the world’s second-largest economy as measured by purchasing power, the Financial Times reported. The US remains in first place with Germany in third and India fourth. The calculations, which convert local currencies into US dollars and measure what goods citizens can afford, showed that developing economies were 2.2 times larger when measured  by purchasing power rather than exchange rates. It is the first time since 1993 that relative purchasing power in many countries has been measured. China was fourth in the latest global GDP rankings from 2006, behind the US, Japan and Germany.