China
In 2024, China’s economy will grow at a slower pace. The real GDP projection sits at 4.5% based on Q1 estimates—a downward revision of 0.4 percentage points from last quarter and below the 5.2% growth in 2023.
Inflation remains on the lower side at 1.5%, up from 0.3% in 2023. Weak domestic spending will keep the rate down this year. Deflationary risks are still prevalent, but price pressures are set to normalise in the months ahead.
Prolonged distress in the real estate market and broader spillover to other sectors like banking are the biggest threats to the country’s outlook. These challenges could trigger a wave of defaults, erode confidence in the financial system and cause capital flight and currency depreciation.
These headwinds and overall uncertainties in the outlook continue to weigh on business and consumer confidence, which hinders spending and investment growth potential.
The government plans to continue fiscal support to foster high-quality development, revive domestic demand and tackle the real estate crunch. An additional stimulus may be needed to restore confidence and prompt an economic rebound.
China: Q1 2024 Forecasts
Source: Euromonitor International Macro Model
Note: Annual rates in percentages. Revisions in percentage points.
