China's 'Bumpy Deceleration'

Goldman Sachs Exchanges

Goldman Sachs

Business

4.4 • 1K Ratings

🗓️ 11 February 2019

⏱️ 20 minutes

🔗️ Recording | iTunes | RSS

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Summary

The bumpy deceleration underway in China will be met with additional economic policy easing, albeit with some notable differences to previous stimulus, says Goldman Sachs Research's Andrew Tilton. He expects a slightly smaller and later stimulus relative to other slowdowns, leveraging not only Chinese policymakers' typical favored tools like infrastructure spending but also a tax cut. This podcast was recorded on February 1, 2019. All price references and market forecasts correspond to the date of this recording. This podcast should not be copied, distributed, published or reproduced, in whole or in part. The information contained in this podcast does not constitute research or a recommendation from any Goldman Sachs entity to the listener. Neither Goldman Sachs nor any of its affiliates makes any representation or warranty, as to the accuracy or completeness of the statements or any information contained in this podcast and any liability therefor (including in respect of direct, indirect or consequential loss or damage) is expressly disclaimed. The views expressed in this podcast are not necessarily those of Goldman Sachs, and Goldman Sachs is not providing any financial, economic, legal, accounting or tax advice or recommendations in this podcast. In addition, the receipt of this podcast by any listener is not to be taken as constituting the giving of investment advice by Goldman Sachs to that listener, nor to constitute such person a client of any Goldman Sachs entity. Copyright 2019 Goldman Sachs & Co. LLC. All rights reserved.

Transcript

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0:00.0	This is the
0:08.0	Exchanges at Goldman Sachs where we discuss developments currently shaping markets, industries, and the global economy.
0:14.4	I'm Jake Stewart, Global Head of Corporate Communications here at the firm.
0:18.0	China's economy's been in the news lately as GDP growth in 2018 was the slowest since 1990 to talk through the drivers of what we might call
0:26.3	bumpy deceleration as some of the analysts have called it. Policy tools available to cushion
0:31.1	the impact, trade tensions, and much more.
0:33.7	We're joined by Andrew Tilton.
0:35.4	Goldman Sachs chief Asia economist Andrew, welcome to the program.
0:38.6	Thank you.
0:39.6	Nice to be here.
0:39.8	In November of last year, 2018, your team published an outlook on China, which you
0:43.9	predict what you call bumpy deceleration of the economy of China, certainly panning
0:48.3	out in light of recent reductions in the growth projections there.
0:52.1	What's the magnitude of the slowdown
0:53.8	and what's basically driving it?
0:55.5	Well, I think it's confusing to a lot of people
0:57.4	because if you look at GDP,
0:59.2	there hasn't been much of a slowdown.
1:01.0	GDP growth was 6.6% last year and in the latest data point, fourth quarter GDP was 6.4 year
1:09.4	over year.
1:10.4	So looking at those numbers, it doesn't seem like there's been much of a slowdown.
1:13.6	But GDP is unusually smooth in China, and so we, as have some other analysts, have tried to create
	...

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