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China aims for economic growth of approximately 5%

China has set an ambitious economic growth target of around 5% for 2024, aiming to revitalize an economy facing significant challenges. This goal, announced by Premier Li Qiang during the annual session of the legislature, mirrors the target set for the previous year, which saw GDP growth of 5.2%. Despite the modest measures outlined to stimulate growth, there is a sense of caution within the business community, which is looking for more decisive action to address issues such as the ongoing property crisis, declining consumer confidence, and investor apprehension.

The central government plans to keep the deficit at 3% of economic output, with an additional $140 billion in bonds to fund national projects. While this borrowing capacity allows for increased spending on initiatives to boost the economy, some experts question the effectiveness of such measures without addressing underlying growth difficulties.

One notable absence from this year’s agenda is a comprehensive plan to bolster the social safety net and stimulate consumer spending. Neil Thomas, a fellow at the Asia Society, highlights the lack of concrete proposals to tackle the core issues affecting growth.

Economists are also skeptical about China’s reported growth figures, particularly as last year’s rebound was influenced by stringent Covid-related measures. Achieving similar growth this year without similar external factors presents a significant challenge.

Consumer and investor sentiment remains cautious, with concerns about sustained recovery and fluctuating stock markets. While the government has taken steps to encourage investment, Premier Li maintains that China is on a positive trajectory, emphasizing resilience in the face of external pressures.

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Efforts to drive growth through new avenues such as clean energy, electric vehicles, artificial intelligence, and frontier technologies are highlighted in Mr. Li’s report. However, challenges in the housing sector, including a surplus of properties and debt-laden companies, could impede progress.

To sustain economic growth, China may need to rely on debt-fueled spending, but caution is advised to ensure desired outcomes. Recommendations to strengthen the social safety net and boost consumer confidence remain valid, though officials are hesitant due to demographic challenges posed by an aging population.

External forces, such as trade disputes and geopolitical tensions, pose additional obstacles to China’s economic stability. The country’s reliance on exports, particularly in manufactured goods, highlights the need for strategic measures to enhance trade surplus and mitigate risks.

Despite the challenges ahead, China’s focus on innovation and strategic investments in key sectors signals a commitment to long-term growth. With ongoing efforts to navigate the complexities of a shifting global landscape, China’s economic future remains a topic of intense international interest.

Intellectuals Insider

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Is now the right time to invest in gold as prices have cooled?

Now may be the time to buy gold following a recent lull in its price.

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The price of gold has climbed to record highs recently and has remained strong through much of April. And, that growth continued until the precious metal traded at around $2,390 per ounce on April 19, 2024. But since, growth in the price of the precious metal has cooled, with gold’s price now hovering around $2,300 per ounce.

This lull in gold’s price may represent an investment opportunity.

In general, investing is centered around buying assets when prices are low and selling them when prices are high – generating a profit on the difference between the two. So, considering the declines in gold’s price over the past few days, now may be the time to make your investment. But is buying gold during this lull in prices really a good idea?

Compare your gold investment options among leading brokers now.

Gold prices have cooled. Should you buy in now?

With gold’s price down from recent highs, you may be wondering if now is the right time to buy in. There are several reasons the dip in gold’s price may represent an opportunity to buy. Here are some of the biggest:

Prices may rise again

If looking at a gold price chart shows anything for certain, it shows that changes in the overall growth of the medal come in fits and spurts. Periods of price growth are typically followed by periods of declines and vice versa.

But with inflation rising in recent months – and with gold’s reputation as a safe-haven asset that can hedge against inflation – it only makes sense that the price of the precious metal will eventually start to head up again in the future. While attempting to time that directional change may be tricky, buying the precious metal while the price is down gives you the opportunity to take advantage of any upward movement that may be ahead.

Add gold to your portfolio now before prices have a chance to rise.

You may be able to make a quick profit

Gold isn’t known as an asset in which you can earn a quick return, but in today’s market, that may be the case. Don’t forget that in January, gold was trading at just $2,000 per ounce. And, by mid-April, the commodity’s price had climbed to around $2,400 per ounce. That’s about 20% growth in a matter of months, much of which happened since March 1 – an impressive climb for any investment asset.

Perhaps more importantly, gold’s price growth through the beginning of 2024 shows that the commodity doesn’t have to be a buy and hold style investment that you keep in a safety deposit box or precious metal depository for years to come. There’s also the possibility that the commodity’s price could climb further ahead, making it a compelling way to potentially generate a quick profit.

There are other benefits of investing in gold

There are other benefits of investing in gold that have little to do with the price growth seen thus far in 2024 – or the lull in prices seen over the past couple of days. Those benefits include:

Inflation protection: Gold has long been considered an inflation hedge, and for good reason. When inflation drives the prices of consumer goods and services up – and the value of the dollar down – gold’s price tends to rise. So, it could be used to maintain the value of your portfolio during inflationary economic conditions. That’s important in today’s economic environment as stubborn inflation continues to weigh on the value of the dollar.
Portfolio diversification: Gold’s price doesn’t always move in the same pattern that bonds or stocks do. So, mixing a reasonable amount of gold into your portfolio (up to 10% of your portfolio assets) as a diversifier could protect you from losses should one or more of your traditional portfolio assets fall in value. “If you have less than 5% – 10% of your net worth in commodities & FX (forex), you should absolutely consider adding exposure to gold and other precious metals,” says Vijay Marolia, money manager and managing partner at the wealth management firm, Regal Point Capital.

The bottom line

Gold’s price has fallen from recent highs – which may represent an opportunity to tap into growth ahead. However, gold isn’t simply a “buy while it’s low and sell while it’s a high” kind of investment opportunity. The commodity can also protect your portfolio from the stubborn inflation we’ve seen thus far in 2024 while acting as a diversification tool that could increase your risk-adjusted portfolio returns. So, consider adding gold to your portfolio today while it has the potential to grow in value.

Joshua Rodriguez

Joshua Rodriguez is a personal finance and investing writer with a passion for his craft. When he’s not working, he enjoys time with his wife, two kids, two dogs and two ducks.