BofA cuts China’s GDP growth forecast for the next 3 years

A top US investment bank cut China’s economic growth forecast on Tuesday for the next three years thanks to the combination of the Delta variant outbreak and tightening controls on the property and the infrastructure sector.

BoFA Securities said its new real gross domestic product growth forecast for China for this year was trimmed to 8.0% from 8.3%, 5.3% from 6.2% in 2022 and 5.8% from 6.0% for 2023.

The bank also said its base-case scenario of the ongoing problems at Chinese property giant Evergrande is “there would be little spillover” effect on the property sector as a whole and financial markets if the government comes to the rescue by facilitating an orderly debt restructuring.