Growth temperature rises in the Chinese economy to 6.4 in April – up from last December

May 11, 2017, by Hubert Fromlet, Kalmar

Summary

From the end of April until the beginning of May, we prepared our traditional spring survey on the business climate and economic conditions in China. We try to find out more about the Chinese business cycle and some important structural issues.  We received again answers from around 15 independent China experts from Asia, the U.S. and Europe – thanks!

¤   Our so-called Temperature Indicator for the Chinese economy improved to 6.4 in April/May compared to 5.2 in December last year (on a scale 1-10; 10=very hot).

¤   The panel expects GDP growth in 2017 and 2018 to remain quite stable compared to 6.7 in 2016 (2017: 6.5 %, 2017q4: 6.3 %, 2018:6.0 % – based on official statistics).

¤   The panel’s GDP forecast on China for 2017 and 2018 includes the assumption of an ongoing gradual but relatively modest upswing in the OECD area as a whole.

¤   75 % of the panelists have rather a downward bias in their forecasts than vice versa.

¤   There are almost no appreciation expectations anymore for the Chinese currency RMB.

¤   90 % of the panelists still see a bubble on the real estate market.

¤   Ranking of some structural areas in China (scale 1-10, 10 = very good): statistics 3.9, institutions 5.3,  marketization of a) banks 4.1, b) stock markets 4.0, c) bond markets 4.4.

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Hubert Fromlet
Affiliate Professor at the School of Business and Economics, Linnaeus University
Editorial board

 

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