On Friday morning, in a press release, the China National Statistics Office said that its economy had a greater 5% in 2024 until a year ago, achieving its official objective.
Analysts interviewed through Reuters hoped that the expansion of the Annual Chinese GDP reaches 4. 9%, a little less than the official objective of approximately 5%, which, according to analysts, ambitious.
Helen Qiao, lead economist for Greater China at Bofa Global Research, told Bloomberg TV that China’s GDP numbers are “pretty incredible. “
Chinese policymakers have yet to release their 2025 GDP expansion target.
Markets got a slight bump from China’s positive GDP release, with the benchmark CSI 300 Index and Hong Kong’s Hang Seng Index both closing 0.3% higher on Friday.
In its data release, the NBS referenced some of the challenges the country is facing.
“We will have to be aware that the negative effects brought through an external environment increase, domestic requests are insufficient, confident that corporations are struggling in production and operation, and the economy is facing difficulties and challenges,” the NBS said.
Analysts characterize the expansion of GDP best than expected from China to a fourth quarter, especially in retail spending.
China’s economy grew 5. 4% in the fourth quarter that a year ago, greater than 5% of the expected analysts, after the competitive measures unleashed in September.
Last year, the Government deployed measures to stimulate internal consumption, adding a program of the client products industry, adding appliances.
Retail sales reached 4. 5 billion yuan in December. For the fourth quarter, retail sales greater than 3. 8% to the fastest of the year.
Annual retail sales increased 3. 5%, well below the expansion of 7. 2% in 2023.
The Chinese economy continued to be supported through its exports, which caused the country’s industry surplus out of only 1 dollar.
In December, commercial production rose 6. 2% as factories scrambled to honor U. S. President-elect Donald Trump’s inauguration opening on Jan. 20. Trump has threatened to impose a 60% tariff on all Chinese goods, which would raise prices for importers.
Consumer sentiment in China, however, has been lackluster. People aren’t spending enough, and some are trading down for cheaper products.
“The key question is whether we can see consumer confidence in the rear and start a meaningful recovery. Pessimism has taken hold lately, and it will take a lot of efforts to get out of the depression,” wrote Darren Tayarray, the head of the threat from countries in Asia-Pacific to the IMC.
The Chinese economy is struggling to recover from the pandemic. It faces many challenges, adding a genuine multi-year wealth crisis, better unemployment for other young people, and deflation.
In the long term, China is grappling with a demographic crisis. The country’s population fell for a third consecutive year in 2024.
Some analysts are calling for caution on China’s uneven two-speed economic growth.
“While economic situations in general, not all the benefits of the sector, highlighting the possible demanding situations in job creation,” Dilin Wu wrote, strategist of studies on the commercial platform in Pepperstone Line.
But bad news could turn into good news for China, Wu added, as an increasing number of challenges may prompt additional stimulus measures during the country’s annual parliamentary meetings in March.
Despite the strong showing in China’s GDP growth last year, there are longstanding concerns over the accuracy and quality of the country’s official data releases.
Gao Shanwen, an eminent Chinese economist, recently said that China’s official GDP figures would likely be wrong and higher than genuine expansion figures.
Analysts at Rhodium Group wrote in a December report that China’s official data needs to be read in the context of implicit “authority bias,” as Beijing highlights some positive and stable data while excluding other more negative data.
Notably, China has reported only a modest slowdown in genuine pre-pandemic securities GDP expansion, from 5. 2% in 2023 to 4. 8% on an annual basis through the third quarter of 2024, however, the government has introduced a number of competitive stimulus measures. Such as a 10 trillion yuan refinancing program for local government debt and a mechanism for the inventory market directly.
“It does not have economic policy like this to counter a minor slowdown,” the analysts wrote.
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