Fashion
China GDP growth seen at 4.3% in 2026 amid moderating export momentum
Monetary policy is expected to focus on fine-tuning rather than aggressive easing. The People’s Bank of China is likely to rely on liquidity operations and reserve requirement ratio adjustments, while avoiding meaningful policy rate cuts to preserve banking sector profitability and financial stability, JP Morgan said in its 2026 Asia Outlook report.
Exports remain the dominant driver of growth, underscoring the uneven nature of China’s recovery. China’s export engine continues to outperform despite rising global protectionism. Real exports are on track to grow around 8 per cent in 2025, lifting China’s share of global exports to about 15 per cent. Exports to the US now account for less than 10 per cent of total shipments, reflecting China’s success in expanding sales across non-US markets.
China’s GDP growth is forecast at 4.3 per cent in 2026 as export-led momentum moderates, as per JP Morgan.
Policy support will remain accommodative, with fiscal expansion and cautious monetary fine-tuning.
Exports continue to drive growth despite rising protectionism and trade frictions.
A weaker yuan and growing AI investment are expected to shape China’s medium-term economic outlook.
While manufacturing capacity is gradually diversifying towards ASEAN and India, these regions remain heavily dependent on Chinese inputs and capital goods. This reinforces China’s central position in global supply chains, even as geopolitical tensions persist.
For global competitors, China’s export strength is intensifying pressure. Japan and South Korea are losing market share in several sectors, while Southeast Asian economies and India, despite export gains, are recording widening trade deficits with China. Replicating China’s manufacturing ecosystem remains difficult due to differences in scale, speed, and state-backed coordination.
Rising competitiveness has also fuelled trade frictions. Since 2024, several economies have introduced anti-dumping and countervailing measures on Chinese products. These barriers are expected to slow export growth in 2026, moderating China’s strongest post-pandemic growth driver, the report added.
Despite a trade surplus exceeding $1 trillion year-to-date, the yuan has weakened by about 4 per cent on a trade-weighted basis. Analysts see limited scope for sustained appreciation, given the managed exchange rate regime and concerns over export competitiveness and deflationary pressures.
Looking beyond traditional drivers, China is accelerating investment in artificial intelligence as a potential new growth pillar. Industry-wide AI and cloud capital expenditure is projected to exceed $70 billion in 2026. While the sector’s near-term impact on headline growth may be limited, it is expected to play an increasingly important role in shaping China’s economic trajectory beyond 2026.
Fibre2Fashion News Desk (SG)
Current account excluding gold and energy indicated net deficit of $3.9 billion, while goods saw a deficit of $9.5 billion.
Turkiye recorded a current account deficit (CAD) of $9.6 billion in March, the country’s central bank said.
Treasury and Finance Minister Mehmet Simsek said the CAD is expected to widen this year, due to high energy and non-energy commodity prices.
Simsek said the deterioration is likely to remain temporary and manageable, thanks to stronger macroeconomic fundamentals and policy gains.
According to annualised data, current account deficit recorded as $39.7 billion (2.6 per cent of gross domestic product) in March, while the goods deficit recorded as $77.8 billion.
Simsek said the deterioration is likely to remain temporary and manageable thanks to stronger macroeconomic fundamentals and policy gains, domestic media outlets reported.
Turkiye is heavily reliant on imported energy, whose prices spiralled due to the Middle East conflict.
Simsek said elevated global commodity prices would put pressure on the external balance, but emphasised that the government’s economic programme had improved resilience against such shocks.
He said foreign direct investment (FDI) inflows totalled $1 billion in March, bringing annualised foreign direct investment to $12.6 billion.
The new investment incentive package under discussion in parliament now is expected to strengthen the country’s financing structure and support long-term capital inflows, he added.
Fibre2Fashion News Desk (DS)
During the first quarter of ****, the UK’s imports of textile fabrics eased down *.** to £*,*** million (~$*,*** million), against £*,*** million in January-March **** but slightly higher from £*,*** million in the fourth quarter of ****. Its imports of fibre were noted at £** million (~$***.** million) steady as £** million in Q*, **** but slightly lower than £** million in Q*, ****.
During the third month of this year, the country’s clothing imports declined *.** per cent to £*.*** billion (~$*.*** billion), compared with £*.*** billion in March ****. But the inbound shipment was slightly higher month on month compared with £*.*** billion in February ****.
Higher rents, utility bills and fuel prices are eating away at already thin profit margins, it found.
High inflation is cutting deep into Bangladesh consumer spending, with weak demand turning one of the biggest concerns for businesses, DCCI said.
Higher rents, utility bills and fuel prices are eating away at already thin profit margins.
DCCI’s economic position index revealed that consumers have sharply reduced spending as the cost of living continues to rise.
SMEs are feeling the pressure the most.
The chamber’s economic position index (EPI) revealed that consumers have sharply reduced spending as the cost of living continues to rise, putting pressure on retailers, transport operators and other service providers.
Small and medium enterprises (SMEs) are feeling the pressure the most as they struggle to manage higher operating costs without losing customers.
Businesses also cited difficulties in obtaining bank loans, while delays in licensing and other regulatory procedures are adding to costs.
The DCCI report identified a shortage of skilled workers, particularly in technical and customer service roles, as another challenge for the sector.
The country’s inflation rose to 9.04 per cent in April from 8.71 per cent in March, according to official statistics.
Fibre2Fashion News Desk (DS)
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