Goldman Sachs(US:GS)2026-01-30 03:14Summary of Key Points from the 2026 Global Macro Conference on China Industry Overview - The conference focused on the Chinese economy, policy, and markets, reflecting the views of both domestic and global investors regarding China's economic outlook and key issues affecting the market [5][6]. Core Insights 1. GDP Growth Expectations: - Over two-thirds of investors anticipate China's official real GDP growth for 2026 to be between 4.6% and 4.9%. The baseline scenario predicts a growth of 4.8%, which is above the Bloomberg consensus of 4.5% due to resilient export growth and policy easing [6][10]. - More than half of the investors expect annualized real GDP growth to be 4-5% during the 15th Five-Year Plan (2026-30), an increase from last year's expectation of 3-4% [6][16]. 2. PPI Deflation Outlook: - 82% of investors believe that PPI deflation will end in 2027 or later, indicating a shift in market sentiment towards caution compared to last year [6][12]. - The baseline forecast expects PPI inflation to rise from -2.6% in 2025 to -0.7% in 2026, turning positive by late 2026 or early 2027 [6][12]. 3. Real Estate Market Predictions: - Only 7% of investors expect house prices to bottom out in 2026, while 34% predict this will happen in 2027, and nearly 60% expect it to occur in or after 2028 [6][18]. 4. RMB Exchange Rate Expectations: - More than 90% of investors expect the RMB to appreciate against the USD this year, with a target range of 6.8-7.0 [6][14]. - Last year, only 3% of attendees anticipated the USDCNY to fall below 7.0 by the end of 2025 [9][14]. 5. Equity Market Outlook: - Over 90% of investors expect the China equity market price index to increase by at least 10% in 2026, aligning with the equity strategy team's views [9][23]. - However, research indicates that a stock market rally may have limited impact on household consumption, benefiting only a specific subgroup of the population [9]. 6. Geopolitical Concerns: - Investors expressed heightened concerns regarding geopolitical risks and military conflicts compared to other factors such as fiscal sustainability and US-China tensions [9][25]. Additional Important Insights - Domestic investors showed more confidence in China's export resilience, while foreign investors were more cautious about sustainability [8]. - Key topics of interest during client meetings included expectations for the "Two Sessions," property market policies, and consumption boosting measures [8]. - The majority of investors believe that central bank surprises this year may come from the US and Japan rather than China, with expectations of two 10 basis point cuts in the PBOC policy rate in 2026 [9][20]. This summary encapsulates the key findings and insights from the conference, highlighting the evolving perspectives on China's economic landscape and investor sentiment.