China’s ‘Zero-Covid’ Strategy Will Drag Growth to Below 4%, Nomura Says

(Bloomberg) — Nomura Holdings Inc. cut its full-year economic growth forecast for China to 3.9% from 4.3%, one of its worst outcomes in decades, citing disruption caused by the country’s commitment to “zero-Covid” strategy.

The downgrade was due to “rapidly” worsening high-frequency data for April and logistics problems as a growing number of cities fully or partially lock down to contain the virus. Beijing has also shown no sign of a move away from its zero-Covid strategy soon, Nomura’s economists including Lu Ting wrote in a note Thursday.