JP Morgan came out with a downbeat economic forecast for China amid the ongoing covid woes, as well as concerns emanating from the Russia-Ukraine crisis.

“We downgraded our China GDP forecast again,” said JPM in the opening remarks before mentioning, “Now look for 2Q GDP to contract ‒5.4% (previously ‒1.5%).”

The analytical piece also said, “Our 2Q global growth forecast stands at just 0.6% (easily the weakest quarter since the GFC outside of 2020).”

It’s worth noting that the latest jitters surrounding the US-China trade jitters seem an additional negative catalyst for China. US Trade Representative (USTR) Katherine Tai poured cold water on the face of expectations that the Sino-American jitters will be eased soon, at least for the trade concerns. The US diplomat said, “We're still working on next actions with China,” while turning down the optimism triggered by US President Joe Biden’s comments suggesting a reversal of the Trump-era tariffs on China.

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