China likely to return to trend growth after V-shaped recovery – Goldman Sachs

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The Chinese economy is likely to return to trend growth after its V-shaped recovery saw a record pace of expansion last quarter, Goldman Sachs economists wrote in their latest client note released on Tuesday.

Key quotes (via Bloomberg)

“The economy appears to have passed a turning point.”

“Policy focus has also shifted from helping the economy heal from the COVID-19 downturn to addressing long-term stability and growth issues.”

“Compared to 2019 to avoid distortions from last year’s activity collapse, exports and property sales are clear outperformers, while housing starts and manufacturing investment underperformed.”

“With meaningful slack remaining, household consumption should play catch-up, but probably at a measured pace given the weight of uncertainties and the long way toward herd immunity.”

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