Goldman Sachs on China: Three Key Takeaways
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Goldman Sachs highlights three key China developments: trade negotiations, fiscal policy, and Golden Week consumption data. China and the EU reached consensus on curbing hybrid-vehicle exports, lowering tariffs, and rare-earth export licensing, while the PBoC reiterated its exchange-rate stance, aiming to avoid a sharp renminbi appreciation amid trade frictions. On fiscal policy, the Ministry of Finance approved RMB550 billion of new local government bond quota to help secure the full-year growth target, yet roughly RMB3 trillion of existing quota remains unused, pointing to transmission bottlenecks. Holiday data confirmed soft consumption: per-capita domestic tourism revenue fell 1.9% year on year during the National Day Golden Week, and cross-regional passenger traffic rose only 0.6%, far below the 6.2% growth a year earlier. The bank frames the EU-China consensus and central-bank currency messaging as stabilizing renminbi expectations, with the fresh bond quota aimed at growth targets despite constrained transmission, while weak tourism spending underscores insufficient consumption momentum. A third round of EU-China trade and investment consultations is scheduled for March 2027. The report lists no specific stock recommendations.