JPMorgan Econ FI-China Back to trend-growth in 2H 2024 mid-year outlook-108996154

JPMORGANAsiaPacificEconomicResearch03July2024China:Backtotrend-growthin2H2024mid-yearoutlook•China’seconomicactivitystartedstrongin1Qbutsoftenedin2Q.TheEmergingMarketsAsia,EconomicandPolicyResearchvolatilitywasdrivenbyLNYseasonalityandchangesinpolicydynamics.HaibinZhu•PolicyadjustmentsincetheAprilPolitburomeetingcanhelpavoida(852)2800-7039collapseineconomicactivityin2Qasobservedoneyearago.Weexpecthaibin.zhu@jpmorgan.comgrowthwillfallbelowtrendin2Q(3.5%q/qsaar)butreturntotrend-growthin2H(4.5%q/qsaar).Full-yearGDPgrowthforecastis5.2%inrealterms,butGraceNgjust4.7%innominalterms.(852)2800-7002•Theliftingfactorsincludeinvestmentonmanufacturingupgrade,greengrace.h.ng@jpmorgan.comsectorsandexports.WhilemanufacturinginvestmentwilllikelycontinuetoTingtingGeoutperform,exportsmayfaceuncertaintyamidincreasingtradetensionanduseoftariffs,sanctionsandotherrestrictivemeasures.(852)2800-0143tingting.ge@jpmorgan.com•Housingremainsthebiggestdrag.ThelatestroundofhousingpolicyJiYanrelaxationisinsufficienttostabilizehousingactivitysoon,andwehavereviseddownourfull-yearforecastforhousingactivityandrealestateinvestment.The(852)2800-7673newpolicyinitiativetoreducehousinginventoryisintherightdirection,butji.yan@jpmorgan.comthepaceofimplementationisunclear.JPMorganChaseBank,N.A.,HongKongBranch•Imbalancesbetweendomesticdemandandsup...