(Bloomberg) -- Goldman Sachs Group Inc. upgraded its forecast for China’s gross domestic product growth this year after the government reported stronger-than-expected economic data and the recovery gathers pace.
The bank’s economists are now projecting the economy will expand 5.5% this year, up from 5.2% previously, they said in a note late Tuesday.
Official data published earlier in the day showed the economy grew 2.9% in the fourth quarter from a year earlier, well above economists’ forecasts for 1.6% expansion. Monthly indicators for retail sales, industrial production and unemployment for December were also better than analysts had expected.
Goldman’s economists said it was “very surprising” the official data for December were not worse, given surging Covid infections and broadly-based labor shortages in the month.
One-off demand for medicines and medical equipment may have helped to boost the fourth-quarter data, the economists including Lisheng Wang wrote in the note. But that probably wasn’t enough to explain the discrepancies between the official figures and high-frequency activity indicators, which had pointed to a marked slump in the December activity.
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