(MENAFN- The Peninsula) Real GDP growth of China is expected to continue slowing from 7 percent in 2015 to 6.4 percent in 2016 and 6 percent in 2017 as the authorities act to shift to a consumer-led economy, QNB Group said in its China Economic Insight 2015 yesterday. The report examines recent developments and the outlook for the Chinese economy as it continues its shift towards a consumer-led economy.
Investment spending is likely to slow further on overcapacity in a number of sectors and as global demand for Chinese exports recovers slowly, it said. The transition to a consumer-led economy may take time to materialise on falling house prices and the risk of deflation.
Inflation is expected to ease in 2015 (0.7 percent) as the weak real estate market lowers rent inflation and falling global food prices lead to low foreign inflation; inflation is expected to recover in 2016-17 to average 1.8 percent, due to monetary stimulus and higher global commodity prices. The central bank is expected to loosen monetary policy further, which should help lift domestic inflation, the report said.
Foreign inflation is projected to recover after 2015, in line with the expected recovery in global commodity prices and a weaker yen. The current account surplus is expected to widen in 2015 to 3 percent of GDP on lower commodity prices, before narrowing in 2016-17 to 2 percent and 1.8 percent as global commodity prices recover, the report said. The Peninsula
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