Nomura slashed China’s 2023 growth outlook to 4.3% from 5.1%
MACRO VIEWS & ANALYSIS
Nomura slashed China’s 2023 growth outlook to 4.3% from 5.1%
MACRO VIEWS & ANALYSIS

Nomura slashed China’s 2023 growth outlook to 4.3% from 5.1%

 

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Nomura lowered the forecast of China’s economic growth in 2023 to 4.3% from previous 5.1%, citing the country’s extended zero-Covid policy.

If China chooses to start reopen the economy after March next year, Covid infections will spike in the short term, it said.

The lower forecast also take into account of other risks including a slowdown in exports, slim chance for real estate recovery and expected decline in passenger vehicle sales next year as the effect of the purchase tax cut introduced this year will ease, said Nomura.

The broker maintained the forecast of China’s 2022 growth at 2.7%, though it raised the forecast of third-quarter growth to 2.8% from 2.6%, but lowered the growth forecast for the fourth quarter to 2.8% from 3.3%.

One day earlier, Goldman Sachs cut its 2023 economic growth forecast for China, predicting Beijing will stick to its stringent Covid Zero policies through at least the first quarter of next year. China’s GDP will probably increase 4.5% in 2023, down from a previous projection of 5.3%, Goldman’s economists led by Hui Shan wrote in a report. There was no change to the prediction of a 3% expansion this year.