1、Ten Macroeconomic Trends in 2023Economic InsightsKPMG ChinaDecember 2022,Chinas economy faced strong headwinds and growth slowed.Four challenges had a particularly significant impacts on the economy:First,the Covid-19 pandemic continued to spread.The highly transmissible Omicron variant triggered mu

2、ltiple resurgences over the past year,which had a significant impact on the economy.With the removal of almost all quarantine measures,the number of new infections surged in December.Second,the real estate market continued to face pressures.In the first 10 months,real estate investment fell by 8.8%y

3、ear-on-year and is expected to see the first annual decline in history,dragging down overall GDP growth by 1.7 percentage points.In addition,sharp decline in land sales also weighed on local governments revenue.Third,the US Federal Reserve(“the Fed”)has raised policy rates rapidly to curb elevated i

4、nflation,while China has adopted easing monetary policies to stimulate growth.The differences in policy stance between China and the United States affected RMB exchange rate and cross-border capital flows.Fourth,rising geopolitical uncertainty and the conflict between Russia and Ukraine have intensi

5、fied supply chain pressure and pushed up global inflation.Meanwhile,the United States has continuously exerted its pressure on Chinas high-tech sector development.Looking forward,we expect Chinas economic policies to remain supportive in 2023,as recovery is still fragile.At the Politburo meeting of

6、the Communist Party of China on 6 December 2022,policymakers pointed out that proactive fiscal policy must be strengthened to improve its effectiveness;prudent monetary policy must be targeted and robust;industrial policies must drive the balance between development and security;technology policies