Via Westpac, comments on China’s situation and projections for for the currency:
wide-spread economic malaise under the weight of authorities’ COVID-zero strategy … (but) talking points of policy makers to promoting investment in pursuit of long-term growth and prosperity.
To be sure, we believe that the restrictive approach taken by authorities has to change — preferably quickly given the low incidence of material health concerns but significant damage to sentiment.
However, we also have to recognise Chinese authorities have an unparalleled capacity to quickly turn their economy through stimulus and co-ordination across all levels of government.
If our growth view proves correct … then CNY6.35 and CNY6.15 at end-2022 and 2023 respectively are readily achievable.