Leading global investment banks are expressing renewed confidence in the Chinese mainland’s economic growth, raising their forecasts for 2025. Institutions like Goldman Sachs, J.P. Morgan, and Morgan Stanley have updated their predictions, citing pro-growth policies and positive trade developments.
Goldman Sachs recently increased its 2025 GDP growth forecast for China from 4% to 4.6%. Shan Hui, chief China economist at Goldman Sachs, highlighted the improved outlook for exports, raising the net export contribution to GDP growth from -0.5 percentage points to 0.1 percentage points.
Nomura also adjusted its predictions, elevating China’s annual GDP growth forecast to 4.5% from 4%. Lu Ting, Nomura’s chief China economist, noted that easing trade tensions between China and the U.S. are a significant positive factor. China’s robust retail sales, boosted by an expanded trade-in program, have also contributed to the optimistic outlook.
The National Bureau of Statistics reported a 5.1% year-on-year increase in retail sales of consumer goods in April, underscoring the strength of domestic consumption.
J.P. Morgan revised China’s GDP growth forecast to 4.8% from 4.1%. Zhu Haibin, chief China economist at J.P. Morgan, attributed this to a series of supportive fiscal policies, including increased government spending and proactive measures to bolster the economy.
Morgan Stanley raised its forecast to 4.5%, pointing to improving household consumption and public spending. Xing Ziqiang, chief China economist at Morgan Stanley, emphasized the impact of the consumer goods trade-in program and the potential of artificial intelligence innovations to boost China’s medium-term growth.
Other financial institutions like Standard Chartered and UBS have echoed similar sentiments, acknowledging the resilience of the Chinese economy amidst global uncertainties. They noted that supportive fiscal and monetary policies are expected to continue driving growth in the coming quarters.
Furthermore, recent visits by high-profile international bankers, including Citigroup Chair John Dugan and Carlyle Group CEO Harvey Schwartz, signal growing confidence in China’s economic prospects. They have expressed a willingness to engage in long-term cooperation with China, reinforcing the positive outlook.
