Analysts at two prominent Wall Street banks have lowered their growth forecasts for China this year.
Goldman Sachs (GS) and Citigroup (C) have each lowered their full-year 2024 projections for China's economic growth to 4.7%.
Previously, Goldman Sachs had forecast full-year growth for the Chinese economy of 4.9%, while Citigroup had forecast growth of 4.8% in the nation of 1.4 billion people.
The downward revisions from the banks come after data showed that industrial activity in China slowed to a five-month low in August.
China’s economy has struggled coming out of the Covid-19 pandemic and amid a debt crisis in the country’s property sector.
Weakening economic activity has led global banks, brokerages and economists to lower their 2024 projections to below the government in Beijing's target of 5% growth this year.
China's industrial output in August expanded 4.5% year-over-year, slowing from growth of 5.1% in July, according to the country’s National Bureau of Statistics (NBS).
Retail sales in China have also been declining as consumer spending slows across the country. Retail sales in August rose an annualized 2.1%, down from 2.7% in July.
“We believe the risk that China will miss the 'around 5%' full-year GDP growth target is on the rise, and thus the urgency for more demand-side easing measures is also increasing,” wrote Goldman Sachs in a note to clients.
The stock of Goldman Sachs is up 23% this year and trading at $478.99 U.S. per share. Citigroup’s stock has gained 9% year to date and trades at $57.67 U.S. a share.
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