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Weak Chinese data raises the case for further policy easing – Nomura
FXStreet (Barcelona) - Research Analysts at Nomura, believe the weak GDP growth momentum seen in Q1 calls for further easing in China, expecting a 25bp interest rate cut, and further share the forecast for IP, retail sales, FAI and GDP.
Key Quotes
“We believe the weak growth momentum in Q1 raises the case for further policy easing and maintain our call for a 25bp interest rate cut and a 50bp reserve requirement ratio cut to be delivered in each of the three remaining quarters of the year.”
“Given the weaker than expected March activity data, we lower our 2015 forecasts for: IP to 6.2% (from 6.7%); FAI to 13.0% (14.3%) and retail sales to 10.5% (11.6%). However, we maintain our full-year GDP growth forecast as we expect the services sector to fill some of the void left by the weaker manufacturing sector.”