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[Ferro-Alloys.com] China's policymakers will strike a balance between containing the novel coronavirus pneumonia outbreak and facilitating the resumption of regular business activities as a prolonged economic standstill could trigger greater risks, economists said.
Most economists believe that China is capable of withstanding short-term shocks given the size and resilience of its economy and the immediate policy support to contain risks. Some forecast a V-shaped or rapid rebound of growth around the second and third quarter as production resumes to normal levels.
While data suggests that the country's economic activities remain subdued, compared with the same period of last year, there have been positive signs in the economy such as robust steel production growth, improving property sales and more traffic, Wang Tao, chief China economist at UBS Investment Bank, said in a research note.
"We still expect a V-shaped rebound in Q2 to Q3 activities as pent-up consumer demand is released and production resumes to a normal level," Wang said.
"We revise up our forecast for infrastructure FAI (fixed-asset investment) growth noticeably from 5 percent to 8 percent. In our view, infrastructure is still an important lever for the government to boost GDP when needed," economists at US investment bank Goldman Sachs wrote in a research note. (China Daily)
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