China's economy is expected to slow in the second half of the year as policymakers in Beijing avoid launching broad-based stimulus. The outlook points to weaker momentum over the next six to nine months, with several longstanding pressures still weighing on activity.
According to the summary of BCA Research's view, weak credit demand remains a major concern. That suggests businesses and households are still cautious about borrowing and spending, limiting the ability of stronger fiscal support alone to drive a broader rebound.
A prolonged property downturn is also seen as a key drag on growth. At the same time, exports are expected to moderate, removing another source of support for the economy as external demand becomes less helpful than it had been earlier.
Even if fiscal spending accelerates, the broader picture suggests those measures may not be enough to fully offset softer lending demand, housing weakness and cooling trade. As a result, China's economic growth path appears set to become more challenging in H2 unless underlying demand improves.
