Morgan Stanley reduced its forecasts for China’s economic growth into next year, citing weaker investment due to the property market slump and local government financial stress.
The investment bank now sees gross domestic product expanding 4.7% this year, down from an earlier projection of 5%. It also lowered next year’s forecast to 4.2% from 4.5%, economists led by Robin Xing said in a research note on Wednesday.
The downgrades were due to “a steeper capex slowdown amid deleveraging in the property sector” and by local government financing vehicles, with knock-on effects on consumption, the economists said. “Roughly a tenth of the GDP cut is due to weaker exports,” it said.
The move follows downgrades by several other banks this week including JPMorgan Chase & Co. following worse-than-expected economic data for July. Beijing had set a growth target of around 5% for this year.
“While we have seen successive and incremental property and infrastructure easing measures since the July Politburo meeting, the steeper growth slowdown means policy is probably behind the curve again,” Morgan Stanley said.
Due to weaker demand in the economy, the bank also cut its 2023 consumer inflation forecast to 0.4% from 0.9%, and reduced its 2024 forecast to 0.9% from 1.6%.
Forecasts for producer-price inflation for this year were reduced to -3.3% from -3%, while next year’s was cut to -1.5% from -0.3%.
Pew survey reveals slight majority consensus on tax rates, but views splinter based on political alignment and income levels.
While the Federal Reserve's decision to hold interest rates steady in March was widely expected, it's the reactions from financial professionals that provide a more nuanced picture of the central bank's approach.
The pioneering member of Canada's Maple Eight is stepping back from its go-it-alone private equity approach as a drought in deals and Trump's trade war prompt a rethink.
The firms' latest additions in Florida and Nevada come as a strategic change at UBS raises risk of advisor defections.
The new program offers opportunities and events structured for rookies, next-gen advisor leaders, and soon-to-exit veterans.
In an industry of broad solutions, firms like intelliflo prove 'you just need tools that play well together'
Blue Vault Alts Summit highlights the role of liquidity-focused funds in reshaping advisor strategies