Search
  Macro-Economy Tool: Save | Print | E-mail   
China GDP growth may fall under 7% in Q2
Last Updated(Beijing Time):2012-06-14 00:00

China's annual economic growth could drop below 7 percent in the second quarter, an influential government adviser said in published remarks yesterday, the most pessimistic forecast of any government or private-sector economist.

Sub-7 percent growth would reflect the pace of the economy during the global financial crisis. China reported economic growth of just 6.6 percent in the first quarter of 2009.

A sharpening slowdown in the world's second-biggest economy galvanized policymakers last week into cutting interest rates for the first time since the global financial crisis - their boldest move yet to try to revive an economy facing its sixth straight quarterly slowdown.

"GDP growth in the second quarter could fall below 7 percent if there is no significant improvements in economic data for June," said Zheng Xinli, deputy head of the China Center for International Economic Exchanges (CCIEE) - a government think-tank in Beijing.

His comments were carried in the overseas edition of the People's Daily.

Zheng said year-on-year industrial output growth usually outpaces GDP growth by 3-5 percentage points. Industrial output rose 9.3 percent in April, the weakest pace in three years, and gained 9.6 percent in May.

So unless activity picks up in June, second-quarter GDP growth could be below 7 percent, Zheng argued.

Government and private-sector economists have cut their forecasts for China's economy this year. Many had predicted the low point of China's slowdown would be in the first quarter, but they now expect it in the second quarter.

Analysts forecast in a Reuters benchmark poll in May that China would deliver second-quarter economic growth of 7.9 percent. They forecast full-year growth of 8.2 percent.

Since then, data for May has suggested little pick up in the domestic economy and the central bank has cut rates by 25 basis points, underlining policymakers' concern.

Inflation hit a two-year low in May, retail sales rose at their weakest pace since February 2011 and fixed asset investment growth was the lowest in nearly a decade.

But exports and imports were stronger than forecast as US demand helped offset weakness in Europe stemming from the region's debt crisis.

Zhu Baoliang, chief economist at the State Information Center, another top government think-tank, forecast second-quarter growth of 7.5 percent, cutting his earlier 7.8 percent outlook. He sees the second quarter to be the bottom of the down cycle.

Peng Wensheng, chief economist at China International Capital Corp, the country's top investment bank, has cut his outlook on second-quarter growth to 7.3 percent from 7.8 percent.

Source:Shanghai Daily 
Tool: Save | Print | E-mail  

Photo Gallery--China Economic Net
Photo Gallery
Edition:
Link:    
About CE.cn | About the Economic Daily | Contact us
Copyright 2003-2024 China Economic Net. All right reserved