China Faces 4% Q2 Growth Risk as Property Slump and Weak Spending Deepen
Updated
Updated · CNBC · Jun 15
China Faces 4% Q2 Growth Risk as Property Slump and Weak Spending Deepen
1 articles · Updated · CNBC · Jun 15
Summary
May data due Tuesday are expected to confirm broad stagnation, with retail sales forecast at 0% year-on-year after April’s 0.2% rise — the weakest since Covid restrictions ended.
4.3% industrial output growth would mark only a slight pickup from 4.1%, while fixed-asset investment is seen falling 2% in the first five months as real estate investment remains a major drag.
Jeremy Stevens of Standard Bank said he sees no credible path to 4.6% second-quarter growth and instead expects China to test the 4% threshold as the Iran war squeezes factory margins and confidence.
13.7% real estate investment drag and a large stock of unsold homes are keeping economists cautious, with KKR calling property the biggest reason it is not more bullish on China.
Foreign brands from Haagen-Dazs to Audi are struggling to gain traction, while Chinese firms increasingly lean on overseas expansion and digitalization to offset weak demand at home.