July economic activity seen increasing

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An indicator for China's economic ­activity rose sharply in July, driven by the real estate sector and bank loans, a ­private survey showed Wednesday, adding to signs that the economy is gradually stabilizing.

The Conference Board Leading Economic Index (LEI) for China increased by 1.4 percent in July, following a 0.8 percent increase in June and 0.3 percent increase in May, US research group The Conference Board said Wednesday.

The index is designed to predict turning points in business cycles (economic expansions and contractions) in the coming three-to-nine months.

"An unexpectedly large acceleration in real estate activity provided a boost to the China LEI in July," Andrew Polk, resident economist at The Conference Board China Center in Beijing, said at the release of the survey.

But Polk noted that the index has been volatile recently, and overall its growth has been slowing.

The Conference Board Coincident Economic Index for China, another ­index that measures current economic activity, increased by 1.1 percent in July, compared with a 1.1 percent increase in June and a 0.6 percent increase in May, the survey also showed.

"The findings are roughly in line with July's economic data, signaling that the economy may be stabilizing," Yang Weixiao, a senior macroeconomic ­analyst with Lianxun Securities Co, told the Global Times Wednesday.

Official data released early this month showed that China's exports and industrial output rose by more than expected in July, offering positive signs for ­economic growth after a continuous slowdown in the first half of the year.

A chief economist at a government think tank also said Wednesday that China's economy can grow at around 8 percent annually, and that an annual growth rate of between 7 and 9 percent is the new reasonable range for ­economic growth.

"If China's economic growth can be maintained at between 7 and 9 percent annually, there will be no grave inflationary pressure or serious problems about jobs," Fan Jianping, chief economist at the State Information Center, said at a news conference Wednesday.

On Monday, central bank governor Zhou Xiaochuan said China's economic growth momentum still remains strong and that a persistent decline in the ­economy is unlikely. Zhou reiterated that China will maintain a stable monetary policy, although there will be some minor adjustments in the second half.

"China is in a process of urbanization, which will see massive migration of people and rising internal demand," Li Xunlei, chief economist and deputy CEO of Haitong Securities Co, told the Global Times.

"No country in the world that is experiencing massive migration of people will see economic recession. China will not either. The strong economic growth momentum will persist longer than many expect," Li said.

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