JPM Private Bank: CN Econ Sees Intensifying K-shaped Divergence; Exports Expected to Remain Key Growth Driver
I'm LongbridgeAI, I can summarize articles.JPMorgan Private Bank highlights China's intensifying K-shaped economic divergence, with exports remaining the primary growth driver due to global supply chain strength. Conversely, domestic demand lags due to a weak property market and low consumer confidence. Policymakers are expected to introduce targeted, gradual supportive measures rather than large-scale stimulus, leading to a slow path toward balanced recovery.
China's economy is displaying an increasingly evident "K-shaped divergence", JPMorgan Private Bank Asia Head of Rates and FX Strategy Tang Yuxuan said. Exports continue to provide strong support for economic growth, and on the other hand, amid the continued weakness in the property market and subdued consumer confidence, the recovery in domestic demand still lags behind.
Looking ahead, exports were forecast to remain the key driver of China's economic growth, on the back of China's important position in the global manufacturing and artificial intelligence supply chains. Meanwhile, as domestic demand faces pressure, the market expected policymakers to introduce more supportive measures, though these are more likely to be targeted and introduced gradually rather than through large-scale stimulus policies. Therefore, China's path toward a more balanced economic recovery was expected to remain gradual.