Fidelity’s big outlook for 2024: China is the big question mark in the Asian region
The performance of the U.S. dollar and the wavering of investor optimism about China’s recovery have broken the strong growth story of many Asian economies over the past year. According to Fidelity, China could face three different macroeconomic scenarios in the coming year.
Possible scenarios for Chinese growth
According to the first, which is also Fidelity’s base scenario, the consolidation of China’s economy will continue, and recovery will gradually accelerate in parallel with the stabilization of the real estate sector and the revival of consumption. According to experts, the probability of this scenario, in which China’s economic growth will be around 4-5% in 2024, is 65%. Policymakers will provide more fiscal and monetary support to sustain growth, such as effective measures to address deep structural problems that will help rebalance the economy and move away from the old investment-led model. These economic policy steps would also help to stabilize the real estate market, which includes about two-thirds of the wealth of households in China, thus restoring consumer confidence in a spectacular way.
In the event of a recession in developed countries, the strengthening of the Chinese domestic market would help offset the decline in foreign demand.
“Although we believe that the high growth model of previous years is not sustainable; the improving macroeconomic environment could improve corporate profits and ultimately have a positive effect on investor sentiment. For real estate, we would expect prices to stabilize rather than a resumption of growth, and we would keep a close eye on debt levels.”
– said István Al-Hilal, Central and Eastern European director of Fidelity International.
Related news
The increase in real wages affects consumption, which is important for stimulating the economy
The increase in real wages means that more money remains…
Read more >GKI: Do Hungarians really pay a lot of taxes?
In public discourse, we often encounter criticism of high domestic…
Read more >The growth of economic activity in the euro area slowed down in July
Instead of the expected moderate acceleration, the growth of economic…
Read more >Related news
Valeo Foods Completes Acquisition Of Appalaches Nature
Valeo Foods Group has completed the acquisition of Appalaches Nature,…
Read more >Carrefour grows in France and Brazil, lags behind in rest of Europe
Carrefour says it is rather pleased with its financial results…
Read more >Food and beverage innovation plunges nearly 50% since 2007: Mintel
The market research firm said about a quarter of items…
Read more >