Can China’s Politburo ‘break the deadlock’ on economic growth as half-year comes in focus?
- Compared with the just concluded third plenum, an upcoming Politburo meeting is expected to more directly impact market expectations
How to ensure that China meets its annual economic growth targets will come under the spotlight at an upcoming Politburo meeting as leaders face rising calls for more immediate and drastic measures to shore up waning momentum.
More stimulus measures for consumption and the property market, monetary easing and more fiscal support are on the wish list for the meeting, which is traditionally held in late July and is set to look back on the first half year and offer remedies for the remainder of the year, according to analysts.
“Growth slowed down in the second quarter, and the upcoming Politburo meeting may break the deadlock,” Xiao Jinchuan, an analyst with Huaxi Securities, said in a note over the weekend. “Market expectations for more countercyclical policies in the second half of the year have increased, and the Politburo meeting has become a focus.”
The world’s second-largest economy posted a 5 per cent year-on-year increase in GDP in the first half of the year. Still, momentum took a hit as year-on-year growth in the second quarter decelerated to 4.7 per cent, and as quarter-on-quarter growth slowed to 0.7 per cent, official figures suggested.