Fitch Raises Its 2021 China Growth Forecast to 8% From 7.7%

Credit rating agency Fitch raised its forecast this week for Chinese economic growth next year, based on increased domestic demand and expectations of a coronavirus vaccine deployment.

Fitch now expects China’s GDP to expand 8% in 2021, up from the 7.7% forecast in September.

“This would be much higher than our estimate of the long-term potential of Chinese growth of around 5.5%, but it is fully achievable from such a low base in 2020,” Fitch analysts Brian Colton and Paul Borowski wrote in the report released Thursday.

Analysts noted that in the past few months, the data indicated a major recovery in Chinese consumption, particularly in the restaurant industry and other activities involving social gatherings. The report said the global economic environment will likely improve in the second half of next year as more people are vaccinated.