Analysts expect targeted fiscal stimulus and cautious monetary policy after April’s disappointing economic figures.
China’s April economic data underperformed, pressured by higher oil prices and weak consumer sentiment. Industrial output in traditional sectors like chemicals declined, though high-tech industries partially offset losses.
Analysts anticipate targeted fiscal stimulus, particularly in infrastructure, rather than broad easing measures. The People’s Bank of China is expected to remain cautious on monetary policy but defend the 6.8 level in USD/CNY, potentially by raising the FX Reserve Requirement Ratio to 6%.
Weak consumer goods sales and discretionary spending highlight ongoing softness, though upcoming events like the 618 festival may provide temporary support. Exports could see a boost later in the year as Beijing finalizes trade measures.