Investment Giants Predict Bleak Future for China’s Economy

Following the release‌ of disappointing statistical data, several investment banks⁣ have revised their growth projections for the Chinese economy in 2024. Initial expectations of a 5% or higher increase in Chinese GDP have now been adjusted, with Goldman Sachs Group ⁤forecasting ⁢4.9%, Barclays at 4.8%, ⁣and JPMorgan ⁣Chase &‌ Co. ‌at 4.7%, as reported by MarketWatch. Even analysts who have not yet adjusted their‌ forecasts acknowledge the risks posed by ⁢the lackluster data.

China’s‍ GDP growth decelerated to 4.7% year-on-year ‍in April-June,⁤ marking the lowest rate since the first quarter‌ of 2023, according to China’s National Bureau of Statistics. Data from‌ June ⁣indicated ⁣a slowdown in both industrial production and‍ retail sales within China.

Looking⁣ ahead to the second half of the year, GDP performance⁤ may further weaken, given the strong base for comparison. The persistent ⁢downturn ‌in the real estate sector continues⁢ to present a significant⁢ challenge.

To sustain growth rates and offset sluggish domestic ⁣demand, China will require increased political backing, ⁣caution analysts. Citi economists highlight that external demand, which ‍previously bolstered exports and mitigated weak ‌domestic demand, is ⁣now constrained by growing protectionist‌ sentiments among trading partners. The recent second-quarter data underscored that “external demand cannot serve as a substitute for domestic demand,” they emphasized.

Despite these adjustments,⁣ macroeconomic forecasts are subject to inaccuracies, as highlighted by calculations from The Insider.⁢ Forecasts for Russian and global GDP by entities such as the World Bank, IMF,⁣ Bank ‍of Russia, and ⁣the Ministry of Economic ‍Development have demonstrated⁢ similar ⁣levels of precision.

Article from theins.ru