The People’s Bank of China has revised downward slightly its estimate for the country’s economic growth to 7 percent this year from 7.1 percent, after the disappointing performance of the economy in the first half of the year.
It also slashed its estimate of inflation by 0.8 percentage point to 1.4 percent.
However, the central bank expects the economy to perform better in the second half of the year, the Hong Kong Economic Journal reported, citing a study co-authored by Ma Jun, chief economist at the PBoC’s research bureau.
The study expects property development to begin to pick up in the second half, boosting infrastructure investment.
It projects 12.6 percent growth in fixed assets this year and 10.7 percent growth in retail sales.
The estimate for growth in exports, however, was slashed to 2.5 percent from 6.9 percent, and imports are expected to shrink 4.2 percent instead of expanding 5.1 percent.
George Leung, an adviser on strategy and economics for HSBC Asia Pacific, said China is facing mounting pressure from a sliding economy, potentially leading to another interest rate cut of 25 basis points (0.25 percentage point).
Translation by Vey Wong
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