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DBS: China GDP may rise 9% this year
By Hu Xiaocen |
January 7, 2013, Monday
|
Online Edition
Online Edition
THE gross domestic product of China could accelerate to 9 percent this year despite the absence of massive fiscal stimulus and credit loosening, Singapore-based DBS Bank said in a report released over the weekend.
If exports fare reasonably better alongside a steadily improving private consumption outlook and an upward investment bias, the recovery of the world's second-biggest economy could well surprise on the upside in 2013, DBS said in its latest outlook report.
The lender said it did not expect the government to lift stringent controls over the property market, and more reserve requirement ratio or interest rate cuts are unlikely since 19 out of 27 provinces reported GDP growth over 10 percent during the third quarter last year. Some areas such as Tianjin, Chongqing and Guizhou registered growth rates of almost 14 percent during that period.
"If China could resist credit loosening during the slowdown, it does not make sense to stimulate the economy by monetary loosening when signs of improvement are already apparent," DBS said. "But it's very likely the benchmark interest rates will rise by 25 basis points in the fourth quarter this year."
It is also noted the economic recovery in the fourth quarter last year was assisted by re-stocking as a result of China's highly directed fiscal spending, which explained rises in purchasing managers' indices announced last week.
If exports fare reasonably better alongside a steadily improving private consumption outlook and an upward investment bias, the recovery of the world's second-biggest economy could well surprise on the upside in 2013, DBS said in its latest outlook report.
The lender said it did not expect the government to lift stringent controls over the property market, and more reserve requirement ratio or interest rate cuts are unlikely since 19 out of 27 provinces reported GDP growth over 10 percent during the third quarter last year. Some areas such as Tianjin, Chongqing and Guizhou registered growth rates of almost 14 percent during that period.
"If China could resist credit loosening during the slowdown, it does not make sense to stimulate the economy by monetary loosening when signs of improvement are already apparent," DBS said. "But it's very likely the benchmark interest rates will rise by 25 basis points in the fourth quarter this year."
It is also noted the economic recovery in the fourth quarter last year was assisted by re-stocking as a result of China's highly directed fiscal spending, which explained rises in purchasing managers' indices announced last week.
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