China’s economy is projected to grow 5% in 2024, up from the earlier forecast of 4.6%, according to the International Monetary Fund (IMF). This revision reflects a stronger-than-expected first quarter and recent policy measures. The IMF also upgraded its 2024 and 2025 growth forecasts to 5% and 4.5%, respectively, but anticipates a slowdown to 3.3% by 2029 due to an aging population and slower productivity growth.
Despite a robust 5.3% year-on-year growth in Q1, deflationary pressures and a persistent property crisis remain concerns. Core inflation is expected to rise gradually to around 1% in 2024. While recent indicators show the economy has navigated some immediate risks, uncertainties about long-term sustainability persist, with retail sales slowing and home prices declining. The IMF emphasized the need for continued housing sector adjustments to achieve a sustainable path.