Five Things You Need to Know to Start Your Day: Asia

Good morning. Goldman raises China growth outlook. The yen plunges further. US inflation surprises to the upside. Here’s what’s moving markets. — Isabelle Lee

Goldman Sachs raised its outlook for China’s economic growth this year as factory activity accelerated more than expected. China’s economy likely expanded at a 7.5% annualized pace in the first quarter from the prior three months, Goldman economists said — higher than their 5.6% prior estimate. The bank now sees 2024 growth of 5%, in line with Chinese policymakers’ target, versus 4.8% previously. Recent data “suggests the Chinese economy found a local bottom in late 2023 and is on the way up,” the firm wrote. KKR and HSBC Asset Management also recently sounded optimistic notes on China even as global investors withdraw billions from the country and after Fitch Ratings revised China’s outlook to negative from stable. Separately, Chinese leader Xi Jinping met former Taiwan President Ma Ying-jeou in Beijing, a rare act of diplomatic engagement between the two sides. “External interference cannot stop the historical trend of national reunification,” Xi told Ma, a comment perhaps aimed at the US, which provides Taiwan with military and political support.