Economists boost China outlook on easing trade tensions
China’s economic growth will show at 5.9% in 2020, according to analysts and traders. The forecast comes as easing trade tensions and the prospect of lower bank borrowing costs had boosted confidence.
This comes as an upgrade from the November’s forecast of 5.8%, before the U.S. and China agreed a ‘Phase One’ dealt to lower tariffs and boost agricultural trade between the two nations. The economy will grow by 6.1% this year and by 5.8% in 2021, according to the median estimate of around 70 economists in a Bloomberg survey.
The latest results suggest sentiment on China’s outlook has started to turn around, boosted by better-than-expected output data in November.
“With the announcement of a trade deal, we now have greater conviction that the Chinese economy is on a mini-cycle recovery path in 2020,” wrote Robin Xing, chief China economist at Morgan Stanley Asia in Hong Kong in a note. Policy makers will continue with “defensive easing,” and monetary policy will remain accommodative to facilitate fiscal easing, he said.