From CNBC: 2025-01-16 03:03:28

Passengers begin 2025 Spring Festival travel rush in China. Despite stimulus plans and interest rate cuts, economic turnaround remains elusive. BlackRock Investment Institute cautions on long-term outlook due to weak consumer spending and deflation concerns. Beijing aims for 2% consumer price inflation and increased tech development in 2025.

China implements trade-in subsidies and equipment upgrades instead of cash handouts. Government issues ultra-long bonds for trade-in program, covering home appliances, electric cars, and smartphones. Program aims to boost recycling transactions but may not sustain consumer demand. Sales boost expected to fade by second half of 2025.

Real estate sector in China once accounted for over a quarter of the economy, facing challenges from debt levels and Covid-19 impacts. Government shifts stance in September to halt sector’s decline. Measures include finishing construction on unsold apartments and potential direct support to stabilize the market.

Geopolitical tensions with the U.S. impact China’s economic challenges. Beijing prioritizes domestic players in strategic sectors like technology for national security. European businesses in China face pressure to localize operations. Beijing emphasizes security and development efforts, focusing on boosting consumption and improving investment efficiency.

Read more: China’s economy is waiting for stimulus. Here are the country’s plans