In recent weeks, a chorus of chief economists from foreign financial institutions have voiced their insights, boosting a narrative of strength and recovery within China's economyThis array of perspectives sheds light on several critical aspects that not only influence market conditions but also outline a pathway for potential future growth.

As the Chief Economist for Deutsche Bank in China, Xiong Yi has elaborated on the encouraging economic data emerging from the nation in October, suggesting that the country's economy is embarking on a robust fourth quarterHe emphasizes that the ongoing policies related to the 'Two New' initiative—namely large-scale equipment upgrades and consumer product replacements—are significantly revitalizing the consumer market, thereby releasing pent-up demand.

Sales figures paint a vivid picture: the retail sales of consumer goods surged by 4.8% year-on-year in October

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This figure indicates a 1.6 percentage point acceleration from the previous monthNotably, sectors such as home appliances, furniture, and automotive sales witnessed substantial growthXiong highlights that the service industry has also seen a production index increase of 6.3%, signifying a boost in sectoral activities.

Amid these developments, the housing market is beginning to stabilize, with a reduction in the decline of property prices, and various monetary and fiscal easing measures are progressively enhancing the capital market's vitalityFurthermore, the industrial production growth and fixed asset investment rates remained stable compared to previous months, reflecting overall economic resilience.

These indicators suggest that China is actively working to unlock consumption-driven growth while simultaneously seeking to expand domestic demand through multiple channels

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'If this momentum can be sustained until the end of the year, there could be further upward space for China's economic growth,' Xiong asserts.

Similarly, Xing Ziqiang, Chief Economist for Morgan Stanley in China, believes that the macroeconomic policies launched since September have played a crucial role in underpinning the economy and reinstating confidence among market participants.

He points out that the recently adopted debt swap policies are advantageous not only in lowering the interest expenditures for the government but also for local governments to settle outstanding debts to enterprisesThis approach significantly improves liquidity and balance sheets of local businesses, which is essential for maintaining liquidity in the marketAn equally important outcome of these measures is the stability they provide to the regulatory environment, ultimately restoring the confidence of entrepreneurs.

Turning to the stock market, Liu Jinjing, Chief China Equity Strategist at Goldman Sachs, maintains an optimistic stance, continuously recommending a 'overweight' position in A-shares

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His projections indicate that, propelled by growth in earnings per share and valuation adjustments, the MSCI China Index and the CSI 300 Index could rise by 15% and 13% respectively by 2025.

Liu notes that policy adjustments have already reduced tail risks for the Chinese stock market this yearWith further policy implementation anticipated in 2025, there is potential for an upswing in earnings growth alongside a moderate revaluation of stocks.

From a liquidity perspective, the Goldman Sachs research team envisions that policy-driven capital flow shifts may accelerate in 2025. As the landscape for long-term growth and policy clarity develops, investors focused on absolute returns are likely to continue seizing opportunities within the Chinese equity market.

It is also important to note the backdrop of decreasing risk-free interest rates, strong policy support for the Chinese stock market, and improvements in risk appetite, which signal considerable potential for individual investors to increase their equity allocations.

On an encouraging note, Chief Strategist at Pictet Asset Management, Olivier de l’Espinay, has elevated his rating for Chinese equities from 'neutral' to 'overweight' based on sustained strong economic prospects.

Despite the substantial recent surge in A-shares, de l’Espinay believes that additional gains are likely in the coming months

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Considering that the total market capitalization of A-shares is at a two-decade low relative to money supply, the valuations remain attractiveThe recommended strategy involves maintaining a barbell approach by overweighting economically sensitive financial sectors alongside defensive utility sectors.

Looking ahead to the economic landscape of China for the coming year, Goldman Sachs Chief Economist Shunhui expressed her belief that by 2025, Chinese exports will stabilize, and consumption—particularly goods consumption—will exhibit favorable growth trendsWith local governments accelerating their debt-mitigation efforts, financial pressures may ease, paving the way for increased government investment and consumption activities.

She also foresees the introduction of additional fiscal policies, advocating that future initiatives should be geared towards boosting domestic demand with increased focus on sustaining social security nets, such as raising the base pension for rural citizens, enhancing unemployment insurance systems, and increasing subsidies for multi-child families