Goldman Sachs Group (343.09, 0.78, 0.23%) believes that after the V-shaped recovery ended with a record expansion rate in the last quarter, China’s economy is now on the track of trend growth.
“China’s economy seems to have passed a turning point and the focus of policy has shifted from helping the economy recover from the epidemic to solving the problems of long-term stability and growth,” Hu Shan, an economist at Goldman Sachs, wrote in a report on Tuesday
China’s economy grew 18.3% year-on-year in the first quarter. Goldman Sachs said that behind the high growth rate, there are huge differences among industries and the continuous change of growth drivers.
With the recovery and re opening of the world economy, China’s exports may also see a change in demand. Demand for Chinese made personal protective equipment is likely to slow, while non epidemic related products are expected to drive exports this year. Research shows that the global real estate boom and economic re opening can completely offset the negative impact of the decline in demand for epidemic related products.
Goldman Sachs expects that in the context of sound economic performance, the Central Bank of China will keep policy interest rates unchanged, and credit growth will moderate decelerate before the end of this year, approaching nominal economic growth.
Due to the different performance of different industries, it is expected that the government will maintain the necessary support in some areas and impose more stringent restrictions on other areas such as the real estate market.