SLOWDOWN IN CHINA

CHINA Q2 GDP GROWTH EXPECTED TO DIP BELOW 7%

Reuters

The Financial Express, June 14, 2012

(Beijing) China’s annual economic growth could fall below 7% in the second quarter if weak activity persists in June, an influential government adviser was quoted on Wednesday as saying.

The forecast by Zheng Xinli, a former deputy director of the Chinese communist party’s policy research office, is among the most bearish by any government and private sector economists. “GDP growth in the second quarter could fall below 7% if there is no significant improvements in economic data for June,” the overseas edition of the People’s Daily quoted Zheng Xinli, now deputy head of the China Center for International Economic Exchanges, a top government think-tank, as saying.

China’s industrial output growth usually outpaces GDP growth by 3-5 percentage points, the newspaper cited Zheng as saying. China’s industrial output rose 9.6 percent in May from a year earlier, picking up slightly from a three-year low of 9.3% stuck in April.

Analysts forecast in a Reuters benchmark poll in May that China would deliver its weakest quarter of growth in three years in the second quarter at 7.9 percent, which would also mark the sixth straight quarter of slower growth. They forecast full year growth of 8.2 percent.

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