China’s 2019 growth to slow to 6.2 per cent despite policy support, survey says
- The forecast of 6.2 per cent would still fall within the government’s target of 6.0 to 6.5 per cent, but it would mark the weakest pace of growth China has seen in 29 years
- Optimism has increased that the United States could reach a deal with China soon to end the trade war
China’s economic growth is expected to slow to a near 30-year low of 6.2 per cent this year, a Reuters poll showed on Friday, as sluggish demand at home and abroad weigh on activity despite a flurry of policy support measures.
The median forecast was slightly lower than the 6.3 per cent economists had predicted in the last poll in January.
While the world’s second-largest economy has shown some signs of steadying recently, analysts caution it is too early to tell if the new-found momentum can be sustained.
Policy stimulus thus far has also been more restrained by Chinese standards than in past downturns, which could mean a more gradual recovery.
We expect the economy will slow further in the second quarter as exports likely remain under pressure as global demand deteriorates and the property market stays in a downward cycle, while stubbornly weak consumption for durable goods caps demand.
Most of the 88 institutions covered in the survey do not expect growth to bottom out until later in the year as looser monetary conditions and fiscal stimulus take time to percolate through the economy and revive domestic demand.