Goldman raises China’s growth forecasts
Source: http://www.investmentpostcards.com/2009/04/25/goldman-raises-china%e2%80%99s-growth-forecasts/Posted on Saturday, April 25th, 2009 | In China, Market Commentary
I posted an update on China’s growth outlook a few days ago and said ” … China’s improving PMI seems to indicate that the country might have seen the worst of the growth statistics”. I also referred to a report by BCA Research, stating that “a broad range of macro indicators suggest that the economy may have begun to rebound”.
Interestingly, a “flash” report (hat tip: Fullermoney) by Helen Qiao and Yu Song of Goldman Sachs’s Asian team has just been published in which they have significantly raised their real GDP growth forecasts for China for 2009 and 2010.
Goldman’s new forecasts predict real GDP growth of 8.3% in 2009 (versus 6.0% previously) and, more importantly, that it will reach 10.9% in 2010 (up from 9.0%). These figures are significantly above consensus.
According to the team, the forecast was revised higher as (1) Chinese policy stimulus has been more aggressive, and (2) the domestic demand response has been stronger and has occurred earlier than originally forecast. They expect above-trend growth in 2010 to be largely driven by stronger investment growth, especially from private investment.
The team added, “… we expect policymakers to eventually normalize and shift away from aggressive policy loosening, but only when they are more assured of a stabilization in domestic unemployment and external demand. This would give additional insurance to the growth trajectory we foresee”.
Last 5 posts by Prieur du Plessis
- Prieur’s readings (November 21, 2009) - November 21st, 2009
- The lie of the investment land, according to Dylan Grice - November 21st, 2009
- Gross: Anything but .01% - November 21st, 2009
- The week ahead - November 21st, 2009
- Don Coxe webcast – updated (November 20, 2009) - November 21st, 2009
Cape Town, China, China, Goldman, Goldman Sachs, Helen Qiao;, investment postcards, Market Commentary, Yu Song;
 About Prieur du Plessis (http://www.investmentpostcards.com)
Prieur du Plessis has 25 years’ experience in professional investment research and portfolio management. More than 1,000 of his articles on investment-related topics have been published in various regular newspaper, journal and Internet columns. He has also published a book, Financial Basics: Investment. Prieur is chief executive and principal shareholder of South African-based Plexus Asset Management, which he founded in 1995. The group conducts investment management, investment consulting, private equity and real estate activities in South Africa and other African countries. Plexus is the South African partner of John Mauldin, author of the Thoughts from the Frontline e-letter, and also has an exclusive licensing agreement with California-based Research Affiliates for managing and distributing its enhanced Fundamental IndexTM methodology in the Pan-African area. Prieur is 52 years old and lives with his wife, television producer and presenter Isabel Verwey, and two children in Cape Town, South Africa. His recreational activities include long-distance running, motor cycling, traveling and reading. |
No recommendations, either expressed or implied, are being made to buy, sell, hold or short any of the mentioned stocks. No legal, tax or accounting advice is expressed or implied. Always contact your attorney, CPA, or tax advisor before acting on any legal or tax issues. StraightStocks.com is not responsible for the content, products, or services of any of the advertisers on this site. StraightStocks.com receives compensation from advertisers on this blog. Services and products referred to herein are trademarks, registered trademarks, servicemarks, and/or registered servicemarks of their respective trademark or servicemark owners.
