The lifting of coronavirus restrictions by the government and the reopening of the economy have improved the outlook for China's economy, and prompted economists to revise their forecasts for 2023.
Economists at Japanese bank Nomura said they improved their forecast for China's GDP growth to 5.3% from 4.8%, meanwhile, economists at Union Bancaire Privée - a private bank and capital management company - now expect the economy to expand by 6%, 0.8% higher than the previous forecast. Economists at the Moody's Analytics rating agency, meanwhile, raised their forecast by 0.6% to 4.9%. However, the economists of the Fitch rating agency raised their forecast the most - by 0.9%, to 5%.
Official data released at the end of last month indicated that activity in China's manufacturing and services sectors rose sharply in January, exceeding experts' forecasts and moving into expansion territory. Manufacturing PMI improves to 50.1 from 47.0 in December. Economists expected the index to rise to 49.8. Meanwhile, non-manufacturing PMI came in at 54.4 - also beating forecasts for 52.0 and up sharply from 41.6 in December. The composite index rose to 52.9 from 42.6 a month earlier.
Many analysts expect China's economic recovery to be driven primarily by consumption, but many also warn of a bumpy road to recovery. Meanwhile, Nomura economists have warned that apart from the uncertain outlook for consumption, China's exports may contract in 2023, and the real estate sector may show only a moderate recovery later this year.