China Economic Outlook: Losing Grip

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China’s recovery is at a pivotal point. After the economy roared back to life early this year, momentum has waned. Across almost every metric, China is undershooting expectations; retail sales growth is modest, private fixed investment is going backwards, manufacturers are sitting on their hands and prices are dropping. Worse still, the property market’s fall is showing no signs of slowing.

So where to from here?

  • Officials are slowly rolling out stimulus to support the spluttering economy: There have been tax cuts for electric vehicle sales, money to encourage renovations, and incentives to boost domestic tourism. The People’s Bank of China has also helped by cutting a series of key lending rates. Still, it’s a far cry from China’s stimulus of old.
  • Households and businesses remain wary, suggesting a turnaround in spending is several months off.
  • High global borrowing costs abroad are denting export demand and adding to the economy’s domestic woes. 

Given all that, we have lowered our 2023 growth forecast. We’ve also lowered China’s business cycle status to “at risk” from “recovery”, highlighting the prospect that China could miss its “around 5%” growth target. 

Join us as we discuss China’s challenges and also the emerging green shoots that could provide a base for a recovery heading into 2024. 

* This webinar will be conducted in English and simultaneous interpretation will be available in Chinese and Japanese.

  • Speakers keyboard_arrow_down
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    Steve Cochrane Chief APAC Economist Moody's Analytics Bio
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    Katrina Ell Director-Economic Research Moody’s Analytics Bio
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    Harry Murphy Cruise Senior Economist Moody's Analytics Bio
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    Sarah Tan Economist Moody's Analytics Bio
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    Heron Lim Economist Moody's Analytics Bio