China Lowers 2019 GDP growth target to 6.5%
China has lowered its 2019 GDP growth target setting at 6% to 6.5%.
The move comes as China sets its major economic targets ahead of its annual legislative meeting in Beijing.
Its defence budget growth target was set at 7.5 % lower than the 2018 growth target figure of 8.1%. China also announced a major tax cut.
The GDP target was lowered to 6.5%, allowing policy makers room to move, according to Bloomberg reports.
The lower number indicates the GDP target would be the slowest pace of economic growth in almost three decades. This is a result of China’s long deceleration.
Bloomberg economists see output growth slowing to 6.2% in 2019 down from 6.6% in 2018, while easing further in 2020 and 2021.
China announces major tax cut
China also announced a major tax cut with policy makers announcing on Tuesday a 3% cut to the top bracket of value added tax, in attempts to strengthen the manufacturing sector.
The target budget deficit for 2019 was set at 2.8 % of GDP, up from last year’s goal of 2.6%.
US-China trade wars
On Sunday the US and China came closer to a trade deal that could lift most or all US tariffs if Beijing follows through on pledges around protecting intellectual-property rights and buying more American products.
Economists say that if the tariffs were lifted it would improve the Chinese economy, although debt risks and signs of weakening consumption remain a concern.
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
This information/research prepared by IGA or IGA Group is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. In addition to the disclaimer above, the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.
Please see important Research Disclaimer.
Live prices on most popular markets
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.