Daniel Harrison Financial Research Company Fitch, London/Hong Kong, February 8, 2023: After authorities in China abandoned their “dynamic zero Covid-19” policy stance in late 2022, Fitch Ratings raised their prediction for China’s economic growth in 2023 from 4.1% to 5.0% because of signs that consumption and activity are recovering faster than expected. According to public statements made by health officials and rising mobility trends, the large wave of Covid-19 infections that followed the authorities’ change of approach appears to be subsiding.
Although many high-frequency indicators are still significantly lower than they were before the pandemic, they have recently shown sequential improvement. The Services PMI, for instance, increased to 54.4 in January 2023 from 41.6 in December 2022. The quick recovery from the Covid shock-wave indicates a higher level of activity in 1H23 than we anticipated. The recovery will be off of a firmer base because real GDP growth in 4Q22 was higher than we had expected when we published our last forecast on 5 December 2022.
Financial Research Company Fitch, London/Hong Kong, February 8, 2023: After authorities in China abandoned their “dynamic zero Covid-19” policy stance in late 2022, Fitch Ratings raised their prediction for China’s economic growth in 2023 from 4.1% to 5.0% because of signs that consumption and activity are recovering faster than expected. According to public statements made by health officials and rising mobility trends, the large wave of Covid-19 infections that followed the authorities’ change of approach appears to be subsiding.
Although many high-frequency indicators are still significantly lower than they were before the pandemic, they have recently shown sequential improvement. The Services PMI, for instance, increased to 54.4 in January 2023 from 41.6 in December 2022. The quick recovery from the Covid shock-wave indicates a higher level of activity in 1H23 than we anticipated. The recovery will be off of a firmer base because real GDP growth in 4Q22 was higher than we had expected when we published our last forecast on 5 December 2022.
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