Oriental Wisdom: China's GDP growth forecast for 2025 raised by 0.4 percentage points.

On Wednesday, regarding the specific numbers of the upward adjustment of China's economic growth expectations, French Oriental Huarui Asset Management exclusively responded to Jiemi News that due to the outcome of the China-US Geneva trade negotiations exceeding expectations, they have decided to raise China's GDP growth forecast for 2025 by 0.4 percentage points to 4.3% and for 2026 by 0.2 percentage points to 3.9%. Earlier, Claire Huang, senior macro strategist for emerging markets at Oriental Huarui Investment Research Institute, told Jiemi News that overall, the outcome of the China-US Geneva trade negotiations exceeded expectations and the details were encouraging, prompting them to immediately raise their forecast for China's economic growth. The suspended trans-Pacific transports may resume strongly from May 14, at which time the new tariff rates will take effect. Therefore, China's economy in the second quarter can avoid contraction. In terms of fiscal and monetary policy, the Geneva joint statement greatly reduces the likelihood of China implementing fiscal stimulus in the third quarter. As the 90-day suspension has gained enough time until mid-August, we no longer expect major measures to be taken, while maintaining the expectation of another 10 basis point rate cut in July and September. Even if negotiations stall or fail, the additional tariffs imposed will not go back to 145%, but may be at 54%, a level that can be more easily mitigated through domestic stimulus measures. For the A-share market, this outcome has not yet been fully reflected in stock prices, but further upside is limited as valuations have already recovered to levels before April 2. The renminbi exchange rate will experience range fluctuations. In the short term, this is beneficial for renminbi appreciation, but it is also advantageous for the US dollar, which may alleviate selling pressure.