Source: Bloomberg
Chinese Prime Minister Li Qiang announced in January that China can surpass the growth target of 2023 without relying on "large -scale stimuli".This year may be difficult to make.
China's official pressure is getting greater and greater. It is necessary to quickly increase financial and currency stimulus to achieve about 5%of the growth goals this year.According to data released on Saturday, the industrial added value in August set the longest slowdown since 2021, and the weakness of consumption and investment was beyond expectations.
A few hours before the news was released, the People's Bank of China rarely announced a announcement with disappointing credit data, suggesting that it will increase its efforts to confront shrinkage and prepare more measures to stimulate the economy.
Grow Investment Group Chief Economist, Hong Yan, wrote on the social media platform X, this set of data caused a call for active financial expansion to change expectations and regain economic confidence.Otherwise, you will unknowingly move towards deeper downturn.
Economic deterioration is testing the degree of tolerance of President Xi Jinping for failing to achieve a goal of not being able to achieve a target.If you do not meet the standards, it may further weaken the confidence of the world's second largest economy in the world, and the scale of foreign investors from China from China in the second season will record a record high.
Three months as of June, China's GDP growth rate has slowed to 4.7%. In August, data has been added to the economy to slowly add more evidence since then.At that time, it was the worst level in the five quarters and below the annual goal of about 5%of Beijing.
The current focus turns to the third quarter data in October.Jacqueline Rong, chief Chinese economist in Paris France, estimates that data so far shows that GDP will increase by 4.6%-4.7%in the quarter.
Affected by bad data, Wall Street Economists, including Goldman Sachs, lowered the forecast of the annual GDP, all lower than the official goals.
Xi Jinping said last week that we must strive to complete the annual economic and social development goals and tasks.Compared with the "resolute" goal in July, it seems not so tough.
Ding Shuang, a Standard Championship China and North Asian economist, said that he avoided too much pressure on officials and demanded a 5%growth.As long as they faithfully implement the policy, the final growth rate is slightly lower than 5%.
Xi Jinping delivered the above speeches at the preparation of the comprehensive promotion of ecological protection and high -quality development symposiums in the Yellow River Basin.
The expenditure of local governments was the main driving force for economic growth, but now it has become more unwilling to spend money.In the first eight months of this year, the issuance of special debt on local governments has reached a new low since 2021.
Although the central government may intervene and repeated the rare temporary adjustment of the budget last year, it is almost time to turn the tide to achieve the time left for the 2024 economic growth goals.Analysts predict that September will be a window period, and it is expected to cut interest rates further and decentralized.
Ding Shuang added that even if it introduced additional stimulating measures today, leaders may have to accept the reality of only one season this year.
Part of the problem is that the Barclays Bank estimates that the continued downturn in the property market has led to the loss of about $ 18 trillion in Chinese households.Nomura Holdings, Lu Ting, and other economists estimated that real estate investment in August had double -digit atrophy.
Tong contraction has also become deeply ingrained.With the difficulty of profitable companies, private investment declined from January to August this year.
The People's Bank of China said on Friday that it is necessary to "take the maintenance price and promote the push of prices as an important consideration to grasp the monetary policy" and reiterate the promise made by Pan Gongsheng in June.However, it did not mention Pan Gongsheng's "maintaining policy determination, not much enlarged."
Rong of the Bank of Paris in France said that the central bank may have listed anti -shrinkage as a more priority.She added that as the central bank also values consumption and investment, the policy may shift to encourage family expenditure.
Despite this, although the data looks poor, policy makers may postpone radical stimulus measures under the overall economy.Although China is facing tariffs from the United States and the European Union, exports have reached nearly two years of high points in August.
Louis Kuijs, Chief Asia -Pacific Economist, S & P Global Rating, said that China's senior policy makers are unlikely to no longer care about growth.But to what extent the economy needs, they will agree to adopt a more expansion fiscal policy, which is elusive.
