Global institutions are growing more optimistic about China's economic outlook, even as geopolitical tensions, trade frictions, and energy price volatility weigh on the global economy.

The World Bank, in its July China Economic Update, maintained its 2026 GDP growth forecast at 4.4%, citing steady gains in high-tech sectors. Investment in high-tech industries rose 4.5% year on year in the first five months, while exports of AI-related equipment, new energy products, and electronic hardware continued to support growth, offsetting weakness in property and softer domestic demand.

Fitch Ratings has taken a more upbeat stance, raising its 2026 growth forecast for China to 4.6% in its June Global Economic Outlook. The upgrade reflects stronger-than-expected first-quarter data, underpinned by robust expansion in high-tech manufacturing such as new energy vehicles and industrial robots, alongside resilient foreign trade.

Morgan Stanley is even more optimistic, lifting its 2026 GDP growth forecast to 4.8% and projecting 10% growth in nominal exports. The bank expects sustained global demand for AI computing equipment, energy storage systems, solar products, and electric vehicles, supported by the global AI investment cycle and rising green capital expenditure.

Attention is now turning to the International Monetary Fund, which is set to release its latest World Economic Outlook update later today. Markets will be watching closely for any upward revision to its China growth forecast, which could further reinforce the improving sentiment.