China’s economic growth is set to slow to 7.2 percent in the current quarter, down from the previous three months, as domestic demand weakens, said Song Guoqing (宋國青), an academic member of the People’s Bank of China (PBOC) monetary policy advisory committee.
The nation’s economy is likely to expand 7.3 percent next year, Song said at a forum in Beijing on Saturday.
That view contrasts with a prediction by Fan Jianping (范劍平), chief economist at a state research institute, who said he expects 7 percent growth next year unless the central government imposes stronger-than-expected stimulus measures.
A decrease in exports and property development, two “engines” that fueled China’s rise to become the world’s second-largest economy, would be the main cause of a slowdown in growth, Fan, who works at the State Information Center under the National Development and Reform Commission, told an industry conference on Saturday.
Fan’s forecast is in line with a median estimate of 51 analysts in a Bloomberg News survey as Chinese leaders have signaled they plan to tolerate weaker expansion, leaving the economy heading for the slowest full-year growth since 1990.
The government plans to set a GDP growth target of about 7 percent for next year, according to 13 of 22 analysts polled.
“I don’t rule out that we will see on-year expansion lower than 7 percent in some single quarters next year,” Fan said.
Fan’s remarks might cool an improved sentiment in the Chinese economy as GDP expanded by a better-than-forecast 7.3 percent from a year earlier in the third quarter.
While the government has relaxed home-purchase controls and pumped liquidity to lenders, the economy also got support from a pickup in exports last month.
“In at least six months, economic growth is unlikely to pick up remarkably,” Fan said in Shanghai.
GDP expansion in the three months from this month is seen at 7.2 percent to 7.3 percent, which is set to lead full-year growth to about 7.3 percent as the fourth-quarter reading has a bigger weighting, he said.
China set this year’s GDP growth target at 7.5 percent.
China’s government is holding off broad stimulus, with Chinese Premier Li Keqiang (李克強) expressing a preference for policy improvements and PBOC Governor Zhou Xiaochuan (周小川) vowing to stick with a prudent monetary stance.
China’s economic growth remained unchanged at 7.7 percent last year and might ease to 7.3 percent this year, according to the median estimate of 51 analysts in the survey.
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