"A Chinese recovery will have a positive spill-over to the global economy but also be an inflationary force through its' effect on commodity prices," Danske Bank analysts said.

Reopening to improve home buyer sentiment

"As seen in other countries, reopening of the economy is set to unleash pent-up demand. In China, both services and goods consumption has been depressed over the past year due to the cloud of uncertainty from the zero-covid policy and we look for a rebound in both types of spending."

"The zero-covid policy also worsened the property crisis as it has pushed down home sales through all of 2022. We expect the reopening to improve home buyer sentiment, which in combination with more forceful easing measures towards the property sector is likely to lead to a turnaround here as well."

"We also look for improving business confidence to drive a turn higher in private investments. The government has vowed to support the private sector in 2023, which could entail more positive measures and signals to underpin private investments, not least in the tech sector and manufacturing."