20230718-招银国际-China_Economy__Weak_growth_calls_for_additional_policy_easing_9页_671kb

报告摘要

China Economy Analysis Summary

Overview

This report discusses the weakening of China's economy, particularly in Q2 2023, with GDP growth missing expectations due to declines in property, exports, and consumer spending. Policy recommendations suggest further easing to stabilize the economy, and forecasts adjusted downward for 2023 GDP growth while maintaining 2024 forecast.

GDP Growth

Q2 GDP grew 6.3% YoY, but QoQ growth decelerated to 0.8%, and the 2-year CAGR slowed from 4.6% to 3.3%. Achieving the 5% annual target for 2023 requires accelerating the CAGR to 4% for the year.
We revised our 2023 GDP forecast from 5.7% to 5.1%, and maintained 2024 forecast at 4.8%.

Industrial Output and Retail Sales

Industrial output improved in June, with the VAIO growth accelerating. However, service and manufacturing output remain sluggish in some sectors.
Retail sales declined in June to a YoY growth of 3.1%, though some sub-sectors rebounded. We maintain forecast for 2023 at 7.5% as consumer confidence potentially improves with continued service sector recovery.

Property Market

Property sales, investment, and starts continue to decline, with forecasts lowered for property investment growth from -3.5% to -5% for 2023.
Housing market faces pressure, prompting expectations for policy easing, including reduced mortgage rates and down-payment ratios.

Fixed Asset Investment (FAI)

FAI rebounded in June with a YoY growth of 3.3%, driven by strong infrastructure investment despite ongoing weakness in property.
We cut 2023 FAI growth forecast from 5% to 4%, with sustainability in sectors linked to energy transition and smart technologies.

Policy Recommendations

Recommend further moderate easing of property policies and credit supply to stimulate growth and counter deflationary pressures.
This includes PBOC cutting deposit rates and LPRs, and guiding banks to increase credit for the real economy.

Key Points from Analysis

Economic challenges stem from weak employment, low consumer confidence, and policy uncertainties.
Sector-specific outlook: Energy transition supports manufacturing, but most other industries face slowdowns.