JPMorgan cuts China's 2022 growth estimate to 3.0% from 3.2%

LONDON : JPMorgan on Friday cut its forecast for China's economic growth for this year and next, against a backdrop of prolonged weakness in the housing sector and a resurgence of regional COVID-outbreaks.

JPM revised its full year 2022 gross domestic product (GDP) growth forecast to 3.0 per cent from 3.2 per cent, and revised down lower its 2023 forecast to 4.6 per cent from 5.1 per cent previously.

The cut to the forecast takes JPM's estimate further below the 5.5 per cent growth target Beijing said it hopes to reach in 2022.

"Our baseline assumption expects a shift away from zero-COVID policy next spring," JPMorgan's analysts said.

"While this will help permanently remove the COVID-uncertainty faced by the economy, the transitional period could observe a spike in new infections, volatility in public sentiment and temporary drags on economic performance."