China slides into “confidence trap”

Thursday 22 June 2023

Citi with the note.

China is on the brink of a self-fulling “confidence trap” as the initial reopening impulse starts to fade. The policy mode has shifted from wait-and-see to proactive easing, as confirmed by the June cut.

We continue to expect more stimulus measures ahead to strike a steady recovery of confidence. We cut our growth forecast for 2023E to 5.5%YoY from 6.1%YoY.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific's leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.