5 Mar 2015
China: A hopeful year for reforms - Nomura
FXStreet (Bali) - Nomura Economists look at the main takeaways from China’s NPC, in which the 'new normal' is for lower growth expectations.
Key Quotes
"The 12th National People’s Congress convened its third annual session today,
concluding on 15 March."
"All 2015 macroeconomic targets have been trimmed from 2014, with GDP growth set at “around 7.0%” and CPI inflation at 3.0%. Retail sales, investment and trade growth targets are all lower than last year."
"The government will maintain a proactive fiscal policy stance and an accommodative monetary policy bias."
""The tone on local government financing reform sounds more moderate, suggesting that progress on local government debt control may be slower than we earlier thought."
"Measures to support consumption were also rolled out, as we expected, which could boost GDP by 0.4-0.6% according to our estimate, and help rebalance the economy between consumption and investment."
"We also expect more structural reforms to be implemented this year, including investment and financing-mechanism reform, pricing reform, fiscal and taxation reforms and state-owned enterprise reform, among others."
"The overall message from the Government Working Report is in line with our forecasts, hence our view on the near-term economic outlook and policy stance are unchanged."
Key Quotes
"The 12th National People’s Congress convened its third annual session today,
concluding on 15 March."
"All 2015 macroeconomic targets have been trimmed from 2014, with GDP growth set at “around 7.0%” and CPI inflation at 3.0%. Retail sales, investment and trade growth targets are all lower than last year."
"The government will maintain a proactive fiscal policy stance and an accommodative monetary policy bias."
""The tone on local government financing reform sounds more moderate, suggesting that progress on local government debt control may be slower than we earlier thought."
"Measures to support consumption were also rolled out, as we expected, which could boost GDP by 0.4-0.6% according to our estimate, and help rebalance the economy between consumption and investment."
"We also expect more structural reforms to be implemented this year, including investment and financing-mechanism reform, pricing reform, fiscal and taxation reforms and state-owned enterprise reform, among others."
"The overall message from the Government Working Report is in line with our forecasts, hence our view on the near-term economic outlook and policy stance are unchanged."