Goldman Sachs and Citigroup have tightened their full-year projections for China’s 2024 economic growth to 4.7 percent, off the back of sluggish industrial output and retail sales in August, Reuters reports.
While the Chinese government is targeting a 5 percent rise for the year, Goldman Sachs and Citigroup originally predicted increases of 4.9 and 4.8 percent respectively.
“We believe the risk that China will miss the ‘around 5 percent’ full-year GDP growth target is on the rise, and thus the urgency for more demand-side easing measures is also increasing,” Goldman Sachs said.
[See more: Confidence is at an ‘all time low’ for European companies, says China’s EU chamber]
Citigroup economists urged Beijing to “break the austerity trap” through deploying more fiscal policies that support growth.
The bank has also trimmed its 2025 gross domestic product forecast for China’s economic growth by 0.3 of a percentage point, to 4.2 percent. However, Goldman Sachs maintained its 4.3 percent prediction for 2025.
China’s industrial output last month saw 4.5 percent year-on-year growth; its worst performance since March, according to data from the National Bureau of Statistics. Retail sales rose by 2.1 percent year-on-year, falling short of analysts’ predictions.
