China In Search For A Fresh Impetus

Just as more and more questions were being asked about the extent of the economic
slowdown, China unveiled a bigger-than-expected stimulus programme. The news
galvanised China’s equity markets as well as stock markets across the globe, particularly in emerging countries. Beijing’s move boosted confidence because of its sheer size: interest rate cuts, financial support for China's equity market, measures to help the property sector and fiscal relief for households and companies. For us, these new stimulus measures reflect Beijing’s determination to get growth up to its targeted 5% level. In 2023, the economy grew at one of its slowest paces since 1990. But given the country’s structural problems, we struggle to see how China can grow more than 5%.