The Chinese economy is likely to rebound during the second half of this year, after weakness during the first two quarters. This pattern has repeated itself during the past few years, and is likely to take place again this year, according to a research report released by Gao Hua Securities Company Ltd.
For a number of years, the first half of the year has witnessed economic weakness, while momentum recovered during the second half. The economic engine fades again toward the end of the year until it picks up pace starting from the third quarter, the Beijing-based securities firm observes.
Gao Hua says that this intra-year cycle synchronizes with global economic growth trends, suggesting that the Chinese economy is growing in importance to the rest of the world.
China’s GDP growth for 2014 is expected to be close to the government’s 7.5% target. Gao Hua expects first quarter growth to fall below 7.5%.
Two other investment banks, Bank of America Merrill Lynch and Nomura Securities, also lowered their first-quarter growth forecasts to 7.3%.