Economic Sentiment for China Continues to Rise Slightly
China Economic PanelCEP Indicator Rises to a New Reading of Minus 3.9 Points
In the most recent survey for November (5– 13 November 2019), economic sentiment for the Chinese economy has increased slightly by 1.9 points. The CEP (China Economic Panel) Indicator, which reflects the expectations of international financial market experts regarding China’s macroeconomic development over the coming twelve months, is currently at minus 3.9 points (October 2019: minus 5.8 points). The point forecasts for real gross domestic product (GDP) growth were slightly lowered, however. Growth over the course of the current year is now expected to be 6.1 per cent (previous month: 6.2 per cent). The forecast for 2020 was lowered more strongly, from 6.0 per cent in the previous month to a current estimate of 5.8 per cent.
“The recently increased hope for an early end to the trade conflict with the United States is hardly being reflected in the survey data,” says project manager of the CEP survey Dr. Michael Schröder, senior researcher of ZEW Mannheim’s “Research Department “International Finance and Financial Management”. Assessment of exports remains almost unchanged at minus 11.7 points. Only the expectations regarding changes in China’s share of world trade have improved slightly by 5.3 points to minus 4.4 points.
Expectations of government consumption, domestic and foreign debt have risen significantly compared with the previous month. The indicator values are currently close to zero, however, meaning only that no further decline is currently being forecasted.
In the current survey, assessments of economic development in Hong Kong are very striking. The indicators for economic development and property prices fell by 42.4 points and 58.9 points, respectively. However, the economic development assessment for Shenzhen, Hong Kong’s southern Chinese mainland neighbour region, jumped up by 38.8 points. Future economic development in Hong Kong, with a current indicator value of 1.6 points, is nevertheless still rated better than that of the other six major economic regions in China.