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China's economic growth is 'healthy'
By Wang Yanlin |
November 18, 2011, Friday
|
Print Edition
Print Edition
CHINA'S economy is healthy enough to cope with the present global uncertainties, and the government may allow banks to set aside less capital as reserves in the next quarter, a senior JPMorgan executive said yesterday in Shanghai.
"China's economy is increasingly supported by domestic demand - from investment and consumption - and it is largely healthy given the still rapid growth rate," said Jing Ulrich, JPMorgan's managing director and chairman of global markets for China.
"Although exports haven't contributed positively to China's economy so far this year, a robust domestic demand can sustain growth at around 9 percent," Ulrich said.
Her remarks coincided with the views of other economists and followed the Chinese central bank's statement on Wednesday that it will fine-tune the monetary policies "at appropriate time and with appropriate strength."
Ulrich said China's economy is "carefully engineered" to grow moderately and is unlikely to suffer a hard landing.
She predicted the People's Bank of China may cut the reserve requirement ratio, or the amount of capital set aside by banks as reserves, in the first quarter of next year.
"There is a huge room for the central bank to lower the reserve requirement ratio," Ulrich said, adding that it is less likely for China to cut interest rates in the near term considering the inflationary pressure.
China has set the ratio for big commercial banks at a record high of 21.5 percent, effectively locking up 18 trillion yuan (US$2.84 trillion), or 45 percent of China's gross domestic product.
OCBC Bank Economist Tommy Xie said yesterday in a report that he also expected a reduction in the reserve requirement to improve credit to small businesses.
"China's economy is increasingly supported by domestic demand - from investment and consumption - and it is largely healthy given the still rapid growth rate," said Jing Ulrich, JPMorgan's managing director and chairman of global markets for China.
"Although exports haven't contributed positively to China's economy so far this year, a robust domestic demand can sustain growth at around 9 percent," Ulrich said.
Her remarks coincided with the views of other economists and followed the Chinese central bank's statement on Wednesday that it will fine-tune the monetary policies "at appropriate time and with appropriate strength."
Ulrich said China's economy is "carefully engineered" to grow moderately and is unlikely to suffer a hard landing.
She predicted the People's Bank of China may cut the reserve requirement ratio, or the amount of capital set aside by banks as reserves, in the first quarter of next year.
"There is a huge room for the central bank to lower the reserve requirement ratio," Ulrich said, adding that it is less likely for China to cut interest rates in the near term considering the inflationary pressure.
China has set the ratio for big commercial banks at a record high of 21.5 percent, effectively locking up 18 trillion yuan (US$2.84 trillion), or 45 percent of China's gross domestic product.
OCBC Bank Economist Tommy Xie said yesterday in a report that he also expected a reduction in the reserve requirement to improve credit to small businesses.
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