Latest News:  
Beijing   Overcast/Shower    28 / 20 ℃  City Forecast

Home>>China Business

Morgan Stanley cuts China growth forecast to 8.5%

(Xinhua)

13:33, May 21, 2012

Morgan Stanley announced Monday it has adjusted forecast of China's gross domestic product (GDP) growth to 8.5 percent this year from the earlier forecast of 9 percent as a result of worse-than-expected slowdown in the first four months and later-than-expected policy easing.

The latest forecast came as China's first-quarter GDP growth hit a near-three-year low of 8.1 percent and data in April continued to suggest downside risks for the economy.

Given the circumstances, Morgan Stanley said it is hard for China to achieve the previously anticipated 9 percent growth, but they remain bullish on the macro outlook on intensifying policy easing moves.

"With more policy measures streaming in, we believe China's GDP growth has now troughed and will accelerate noticeably in the third and fourth quarter this year," said a statement by Morgan Stanley.

It expects more aggressive policies to support demand growth, especially if growth weakens further and the external environment deteriorates.

"Our call is essentially that the central bank will cut both lending and deposits benchmark interest rates twice this year, each by 25 basis points," it said.

Meanwhile, Morgan Stanley said the government will likely release more government-led infrastructure investment and SOE-led manufacturing investment projects, before gradually relaxing demand controls in the property market.

It raised GDP forecast in 2013 from 8.6 percent to 9 percent as it expects the positive effects of policy stimulus to spill over into next year.

Email|Print|Comments(Editor:厉振羽、张洪宇)

Leave your comment0 comments

  1. Name

  

Selections for you


  1. Contemporary Youth Sculpture Exhibition

  2. China launches Science and Technology Week

  3. Rare 'Ring of Fire' solar eclipse seen in Beijing

  4. Historic buildings marred as quake hits N. Italy

Most Popular

Opinions

  1. As Beijing remains mum, trade relationships suffer
  2. Intentions behind Japanese right-wingers’ collusion with ‘World Uyghur Congress’
  3. Real intentions of US exercise in Middle East
  4. Short-term trade recovery expected to elude China
  5. Stronger policies needed to push dividend payouts
  6. US, China must co-op to defuse confidence crisis
  7. Regulations holding back financial sector’s progress
  8. City banks' IPO push puts investors at risk
  9. Ways to develop low-carbon economy in China
  10. RRR cut still in country’s best economic interest

What's happening in China

A Bite of China

  1. 'White-collar' definition evolves with China
  2. Airport noise issue mulled over
  3. J&J wins first dispute of its kind in China
  4. China's disabled enjoy e-commerce boom
  5. Energy brings wealth to west China

PD Online Data

  1. Spring Festival
  2. Chinese ethnic odyssey
  3. Yangge in Shaanxi
  4. Gaoqiao in Northern China
  5. The drum dance in Ansai