Goldman Sachs raises China's real GDP forecast: 4.9% growth in 2024, 4.7% growth in 2025

According to CNBC, Goldman Sachs has raised its forecast for China's economic growth in 2024 and 2025. Previously, the Chinese government announced a series of measures to boost economic growth, including plans to expand public spending announced over the weekend. The bank expects China's actual GDP to grow by 4.9% this year, higher than the previous 4.7%. In a report released on Sunday, the institution also raised its economic growth forecast for China next year from 4.3% to 4.7%.

Goldman Sachs economists, including Hui Shan, wrote: "The latest round of stimulus measures in China clearly indicates that policymakers have shifted to cyclical policy management and increased their focus on the economy."

As economists and investors adjust their assessments, they are evaluating the potential impact of the stimulus measures taken by the Chinese government to boost the economy since late September. During a press conference on Saturday, the Chinese government pledged to increase fiscal support.

According to Goldman Sachs' report, Chinese Ministry of Finance officials stated that they will utilize a special local government bond fund of 2.3 trillion yuan in the fourth quarter, implying that the public spending plan will be more significant and the economic growth rebound will exceed the bank's previous expectations.

Furthermore, the National Development and Reform Commission of China announced last week that it will pre-approve investment projects worth 200 billion yuan by the end of this month. Goldman Sachs stated that this effort is aimed at achieving this year's GDP growth target of "around 5%". The report mentioned that the announced and implied easing measures will contribute an additional 0.4 percentage points to next year's economic growth