Bank of America Trims China GDP Outlook On Deepening Evergrande Woes

Source: Reuters

The Bank of America downgraded its growth forecast for China for the next three years due to growing issues of China Evergrande and other concerns such as the pandemic. 3333 is down 0.44%.

• China’s gross domestic product for this year was cut down to 8.0% from 8.3% previously, citing the impact of the Evergrande crisis and regulatory crackdowns.
• The Bank of America also trimmed its forecast for 2022 to 5.3% from 6.2%, and for 2023 to 5.8% from 6.0%.
• The country’s property sector has been put in the spotlight due to the increasing risks of its biggest real estate developer defaulting.
• Evergrande’s liabilities are recorded at $305 billion, with two bond payments due within the week. Analysts believe the firm is unlikely to fulfill its obligations.
• The Bank of America said the best case scenario would indicate just a little spillover on the property sector, should the government push for a debt restructuring.