Q2 Economic Growth Rate in China Expected at 7%... Base Effect of Shanghai Lockdown

A survey conducted by institutions has revealed that China's economic growth rate for the second quarter is expected to reach 7%. Although the economy is slowing compared to the first quarter, this is due to the base effect from last year's Shanghai lockdown in the second quarter.

On the 12th, Chinese economic media Caixin conducted a survey of 14 domestic and international institutions, reporting that experts expect the gross domestic product (GDP) growth rate for the second quarter of this year to be 7% year-on-year. This figure is 2.5 percentage points higher than the previous quarter (4.5%), with responses ranging from a minimum of 5.8% to a maximum of 8.3% among the surveyed institutions.

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Zhang Yu, Chief Macro Analyst at Huachuang Securities, stated, "Regardless of the Purchasing Managers' Index (PMI) output or economic operations in April and May, the economy in the second quarter showed weakness compared to the previous quarter," and forecasted the second quarter GDP growth rate at 6.5%.

Lu Ting, Chief Economist for China at Nomura Securities, predicted 7.3%. He noted that while the figure rebounds due to the low base effect from last year's Shanghai lockdown, excluding the base effect, the actual economic growth momentum in the second quarter is expected to deteriorate to 0.4% compared to 2.2% in the previous quarter. He explained, "The industrial sector could be a major obstacle, and the resilience of the service sector will partially offset this."

Wang Tao, Chief Economist for China at UBS, commented, "The growth momentum of manufacturing production remains relatively weak but is expanding," and assessed that "due to the low base effect, the consumption growth rate in June may slow to 4.8%."

Additionally, experts forecast the average export growth rate for June to rise by 2.7 percentage points to -20.2%, while the import growth rate is expected to be -3.9%. The average forecast for the trade surplus is $73.68 billion (approximately 95.01 trillion KRW), an increase of $7.87 billion compared to May.

A research report from China International Capital Corporation (CICC) also noted that single-customer consumption during this year’s Dragon Boat Festival holiday was similar to that of the previous Labor Day holiday, with overall purchasing power remaining stable.

This content was produced with the assistance of AI translation services.