0833 GMT - China's GDP growth may be capped at 5% for the next few years as excess inventory in the country's housing market could take some years to clear, UOB analysts write in a note. Deflation remains a key threat to the economy and consumer confidence remains weak, they add. Recent stimulus only amounted to 8% of GDP compared with 12.5% in 2008, with little new spending actually boosting the economy, they say. UOB thinks the country will focus on lowering the reserve requirement ratio as a key policy-easing tool instead of interest-rate cuts. UOB expects a further 50-100 basis points of RRR cuts in 2025. (jiahui.huang@wsj.com; @ivy_jiahuihuang)
(END) Dow Jones Newswires
January 14, 2025 03:33 ET (08:33 GMT)
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