Xiong Yi, chief economist for China at Deutsche Bank. [Photo provided to chinadaily.com.cn]
China's economy performed solidly in the first half of 2026 and is likely to strengthen sequentially from the second quarter, supported by lower energy prices and additional policy measures to boost domestic demand, said Xiong Yi, chief economist for China at Deutsche Bank.
One factor underpinning the improved outlook is the retreat in global oil prices after tensions surrounding the Strait of Hormuz eased. Lower energy costs are expected to support downstream demand in both China and overseas, providing a tailwind for China's manufacturing, exports and consumer spending, Xiong said.
At the same time, he expects the government to step up fiscal support.
"We see the government implementing more policies to support domestic demand, especially in the services sector. Coupled with declining oil prices, we believe strengthening domestic demand will be a key support for China's growth in the second half of the year," he said.
