Lower growth is new normal for China, HSBC says

A Chinese bank employee counts 100-yuan notes and U.S. dollar bills at a bank counter in Nantong in China’s eastern Jiangsu province on August 6, 2019. STR | AFP | Getty Images. Sketched by the Pan Pacific Agency.

BEIJING, Oct 30, 2023, CNBC. China’s new normal is going to be lower growth than before, said Fred Neumann, HSBC’s chief Asia economist & co-head of global research, CNBC reported.

“We probably need to adjust our expectations in terms of what the upper ceiling is for China’s growth,” Neumann told CNBC’s “Squawk Box Asia.”

HSBC now sees China’s economy growing 4.9% this year and 4.6% in 2024. Neumann said that will likely be the range of growth for China for the next couple of years and “that’s probably as good as it gets as long as the property market continues to struggle.”

Neumann said even though projections for China’s growth are more modest than they were before the pandemic, there are still some signs of economic recovery underway and growing areas of investments including the electric vehicle space.

Beijing’s current growth target is at 5% for 2023. Data earlier in the day showed China’s manufacturing activity logged an unexpected contraction in October.

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