China's economic growth is projected to reach 4.6 per cent in the first quarter of 2024, marking a decline from 5.2 per cent in the last quarter and the slowest pace since early 2023, according to a Reuters poll on Monday. This slowdown is attributed to a combination of factors such as the prolonged slump in the property market continues to dampen demand, as well as the private businesses and individuals remain cautious in their spending. The government's ambitious target of five per cent growth for 2024 appears increasingly challenging. Analysts note that the high growth rate in 2023 was inflated due to a comparison with the pandemic-affected 2022. While the year started optimistically, recent data on exports, inflation, and lending paints a concerning picture of potentially faltering momentum. This raises the possibility of further government intervention to boost demand. However, some analysts like Zong Liang, chief researcher at Bank of China, believe Q1 growth could be closer to five per cent and the target achievable due to remaining "policy space" for stimulus measures. The poll also forecasts a quarterly growth rate of 1.4 per cent, a slight improvement from the 1.0 per cent seen in the final quarter of 2023. The coming days will be crucial as official GDP data is released, providing a clearer picture of China's economic health and the potential need for further stimulus.
