China’s economy recovery was stronger than projected in the first quarter, Due to resurgence in consumption, and UBS boosted its projection for China’s full-year GDP increase to 5.7 percent in its money management report.
At the same time, UBS retains its projection that China’s stock market earnings would expand by 14% this year, and feels that Chinese stocks have double-digit upside potential this year.
It is positive about consumption, the Internet, transportation, capital goods, and material stocks.
Furthermore, the growth condition in the United States and China, as well as the issue of interest rates, will become the primary driving forces for the dollar against the yuan.
The dollar-yuan exchange rate may fall to 6.5 or below by the end of the year. The yuan will continue to appreciate as the economy recovers from the Labour Day holidays.