China May Set Its Growth Target at 5% for 2025

Nomura analysts predict that Beijing is likely to set a GDP growth target of around 5.0% for 2025. They noted that Chinese policymakers have agreed to support economic expansion since the end of September, which could encourage them to stick to a growth target of around 5% to boost confidence. The Chinese economy is already showing some green shoots, partly due to the policy changes at the end of September. While these signs may be short-lived, Nomura also pointed out that Beijing may want to set a high growth target to signal that it will not succumb to threats of additional tariffs and other punitive measures from Trump.

Lynn Song, Chief Economist of ING Greater China, stated that the pace and scale of China’s stimulus will determine whether the country can maintain sustainable growth. Song observed that despite encouraging signs from Chinese real estate price data in November, core activity figures came in softer than expected. She anticipates that China’s real estate sector will likely reach a bottom point in 2025 before entering a L-shaped recovery. “We expect it will take some time for supportive policies to be implemented, but overall retail sales growth will recover in 2025,” she said.

With only one month of data remaining, ING maintains its 2024 GDP growth forecast at 4.8%, while also acknowledging the possibility of the country reaching its target of approximately 5% growth.