Tuesday, March 14, 2017

Sustained Growth But May Slow Down From 2H17

Economic Research
14 March 2017

Economic Update

China’s economic growth remained stable in 1Q17, amid recovery in industrial sectors and continued infrastructure spending over the past few months. Although economic conditions may remain relatively strong in 1H17, we expect some downside pressure from 2H17:
1. More property tightening measures in tier-2/3 cities;
2. High base effect for automobile sales;
3. Ending of restocking cycle;
4. Accelerating supply-side reforms;
5. Mounting external uncertainties, given tough stance from the US.
As growth is no longer a major overhang, we believe the Government may put more effort towards reigning in financial risks given concerns over growing asset bubble in 2017.

Economist:  Zhang Fan| +8621 6288 9611 ext 105

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