Latest News:  
Beijing   Cloudy/Light rain    26 / 18 ℃  City Forecast

English>>China Business

Analysts show optimism for fourth quarter

(China Daily)

08:00, October 15, 2012

There are strong indications that the slowdown in China's growth may be reversed in the coming quarter when stimulus measures start to take effect, boosting global confidence, analysts have said.

Yi Gang, China's central bank deputy governor, pledged to take "appropriate" measures to tame the six-quarter economic slowdown in the world's second largest economy, on the premise of no harmful consequences.

"The stimulus package this time will be large enough to stabilize growth, but not too large to cause further problems in the future," Yi said on Sunday, as global financial chiefs gathered in Tokyo for the annual meetings of the International Monetary Fund and the World Bank.

It is expected the fourth quarter will enjoy some growth as both monetary and fiscal policies are on track, Chinese economists said.

The quantitative monetary easing is so far working well, as indicated by the rising money supply and long-term credit growth in September, said Sun Junwei, a Chinese economist with HSBC Holdings.

"The filtering-through of monetary easing combined with the scope of faster fiscal spending and acceleration of infrastructure construction, should support a growth recovery in the coming months," he said. "The third quarter will mark the cyclical bottom of GDP growth."

The growth rate in the three months leading to October is predicted to be the slowest in seven quarters, and may fall to 7.4 percent, down from the second quarter's 7.6 percent and the first quarter's 8.1 percent. The official data will be released on Thursday by the National Bureau of Statistics.

The People's Bank of China has lowered both the benchmark interest rates and the reserve requirement ratio twice this year, increasing market liquidity to boost lending for industrial production and service improvement.

Friday's statistics showed strongly rebounding monetary growth in September. The broad money supply growth climbed to a 15-month high of 14.8 percent from a year earlier, compared with the 13.5 percent increase in August.

Indicators of a moderate rebound in economic growth are expected to come in the fourth quarter, and therefore monetary policy easing should not be too fast in the fourth quarter, considering the rising inflation pressure, said E Yongjian, a senior economist with the Bank of Communications.

He expected full-year inflation to rise 2.8 percent from 2011 and said it is unlikely the central bank will again reduce interest rates in the last three months of this year.

"We suggest taking a cautious attitude toward further policy easing, but there is space for another cut of reserve requirement ratio of 50 basis points," he said.

Vice-Minister of Finance Zhu Guangyao gave a speech in Tokyo addressing the measures taken to support employment growth and the development of small businesses.

News we recommend:
China, US battle over auto parts New Silk Road future of trans-Eurasian freight Islands 'purchase' hurts major industry sectors
Global mobile brands find lines busy in China Tough times in the bicycle rental business Gearing up for knowledge economy
Revitalizing China's gloomy exports  New hurdle for Japan's carmakers Secrets of a successful PE firm

Email|Print|Comments(Editor:厉振羽、张洪宇)

Leave your comment0 comments

  1. Name

  

Selections for you


  1. Marine brigade in actual-weapon firing

  2. Weekly review of military photos

  3. The world in photos (2012.09.08-09.12)

  4. Good harvest in Xinjiang County, China's Shanxi

  5. Gorgeous sunglow scenery in Shanghai

  6. Wahaha boss tops China rich list

  7. 3rd Liu Sanjie Cultural and Tourism Festival opens

  8. Weird car accidents

Most Popular

Opinions

  1. Commentary: The case for Huawei in US
  2. No joke, China job creator for US
  3. Commentary: Regulating shadow banking
  4. Editorial: Targeted auto support
  5. Japan should admit dispute over Diaoyu Islands
  6. Telecom firms' business mutually beneficial
  7. US never recognizes Japan's claim over Diaoyu
  8. Maintaining multiple perspectives on China
  9. Commentary: Does China need to buy more gold?
  10. Overcrowded holidays call for gov't management

What's happening in China

Closure of Jinshan Yellow River Bridge completed

  1. Natural disasters kill 1,263 Chinese Jan.-Sept.
  2. Two confirmed dead in winery fire in Xinjiang
  3. Companies to hike pay for interns in 2012: survey
  4. Gorgeous sunglow scenery in Shanghai
  5. Drunken foreigner detained after slashing waiter