Goldman Sachs said it expects China to accelerate fiscal flexibility measures to compensate for the barrier to the ups high -rate rates last week, which were larger than expected.
The Investment Bank said in a report published on Sunday (6) that those of the US, would reduce Chinese GDP growth by at least 0.7 percentage point this year.
“Before, growth was above our predictions, and we were covering a review on our 2025 GDP expectations,” the report said.
Goldman pointed to a comment in the Chinese state newspaper People’s Daily on Sunday, which suggested monetary policy actions and listed measures that China could take.
“Based on the evolving situation, there is ample space for adjustments in monetary policy tools, such as compulsory deposit rate cuts and interest rates, which can be introduced at any time,” the newspaper said.
People’s Daily also pointed to a possible additional expansion of tax deficits, special titles and special treasury titles.
China will take “extraordinary measures” to boost domestic consumption, accelerate the implementation of established policies, and introduce a batch of reserve policies, he said.
He said it in a separate report, also released on Sunday, which has maintained its expected GDP growth from 2025 to China by 4.5% due to better data than the expected first quarter and higher expectations for policy flexibility, but reduced its forecast for profit growth to 9% to 7%.
Trump introduced one on Chinese products as part of high taxes to most US business partners, raising total taxes on China this year to 54%. China retaliated with a series of contracted.
The investment bank also relegated Taiwan to Underweight in its Asian market allocations, citing high export to US exports and market sensitivity.
