The International Monetary Fund (IMF) said China's GDP growth is likely to slow to 4.6% this year from 5.2% in 2023. The IMF also added that the economic expansion last year was less than the December forecast (+5.4%) against the background of weaker consumption in the 4th quarter and the ongoing crisis in the real estate sector.
As for China's medium-term prospects, the IMF forecasts a further slowdown in GDP growth and estimates that the world's second largest economy will grow by about 3.5% in 2028.
Meanwhile, an IMF analysis showed that moving supply chain production — either back to the home country or to allied countries — could lower GDP growth by about 6% in China and 1.8% globally.
The IMF said that after a sharp slowdown in consumer inflation last year, due to lower energy and food prices, inflation could rise to 1.3% in 2024. According to official data, in 2023, the country's CPI went up 0.2%, while PPI dropped by 3% compared with 2022. The core CPI, which excludes food and energy prices, rose by 0.7% last year. The IMF reported that housing has boosted inflation in other countries, but in China, the real estate slump has weighed on prices.